Food Company Owned by Nigerian Billionaire Declares Profit as Rice, Others Sell for New Prices
Bua Foods reported an increase in profit for the first quarter of 2024 from N40.47 billion to N55.82 billion
- The food company is owned by Abdul Samad Rabiu, the third-richest man in Nigeria and his son, Isyaku Naziru Rabiu
- The declaration comes after Nigerians are beginning to experience a fall in the price of food items lately
Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.
In the first quarter of 2024, sales at BUA Foods Plc increased by 147.3% to N356.92 billion from N144.32 billion the previous year.
Source: UGC
The company's financial report showed a notable rise in sugar sales, which propelled revenue growth.
While sales of non-fortified sugar increased to N39.92 billion from N31.41 billion, sales of fortified sugar increased to N197.96 billion from N61.61 billion.
Other segment sales were also up, with pasta sales rising to N37.04 billion from N19.4 billion and bread flour rising to N80.64 billion from N29.64 billion.
Operating profit increased by 117.5%, from N48.15 billion in the previous year's quarter to N104.72 billion in the current quarter due to the triple-digit growth in revenue.
Profit after tax increased from N40.47 billion to N55.82 billion, a 37.9% increase.
BUA Foods, a division of BUA Group, includes BUA Sugar Refinery Limited, BUA Oil Mills Limited, IRS Flour, IRS Pasta, and BUA Rice Limited. It also includes flour milling, rice processing, and pasta manufacturing.
The company, listed in 2022, has a sizable asset base, including the expansive 20,000-hectare Lafiagi integrated sugar estate.
About 99.8% of the food unit is owned by Rabiu and his son, Isyaku Naziru Rabiu.
Legit.ng had reported that following the rallying of the Nigerian currency, the naira, against the US dollar, the price of a 50kg bag of rice has crashed to an average of N67,000 in Lagos, Abuja, Ogun, and other states, from the N90,000 it sold in February this year.
According to recent findings by Financial Derivatives Company Limited researchers, several domestic commodity prices are steadily declining due to the naira's recovery against the dollar and other major currencies.
The managing director of Financial Derivatives Company Limited, Bismarck Rewane, said:
“Notably, prices of some commodities like rice (50kg) decreased by 5.26 per cent to N90,000, sugar fell by 5.88 per cent to N80,000/bag, flour experienced a decline of 7.81 per cent to N59,000/bag, and noodles (carton) witnessed a significant decrease of 15.22 per cent to N7,800/carton.”
Ten states with the highest food prices
Legit.ng reported that the National Bureau of Statistics (NBS) has revealed that the food inflation rate in February 2024 was 37.92% on a year-on-year basis.
This is 13.57% points higher compared to the rate recorded in February 2023 (24.35%).
On a month-on-month basis, the food inflation rate in February 2024 was 3.79%, which was 0.58% higher than the rate recorded in January 2024 (3.21%).
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Source: Legit.ng
