Cadbury reports a 48% decrease in profits from last year

Cadbury NIG PLC released its FY results for 2021 showing a profit of N449.71 million, depicting a 48% decrease from the previous year, despite revenue growing by 19.67%.

The year under review witnessed a persistent hike in prices of goods and services, which resulted in inflationary pressures that affected both consumers and producers. In the same vein, producers encountered a significant surge in the cost of production as raw materials and freight costs increased.

However, the company increased its sales on the back of double-digit food inflation, the profit was restrained by production costs which increased by a whopping 21% y-o-y.

What you should know about the result

* The result shows that the company's profit was driven by significant domestic sales, one of the company's reportable sectors, while export sales decreased during the period. Both segments delivered revenue of N42.37 billion in the full-year period compared to N35.41 billion in 2020.

* The Revenue growth from the domestic sales was at 25% year on year, which gives us the total of N40.27 billion. The revenue from export sales raked in N2.10 billion, representing a 32% decline Y-o-Y.

* The company also made money from dividend income on bank deposits, raking in N856 million during the financial year.

* Cadbury full-year revenue achievement was dominated by high costs of raw and packaging materials, which  affected its profit.

* Also, the company's revenue was affected by double-digit food inflation, border closure, volatility in the FX markets and rising international commodity prices. Although, advertising and sales promotion costs increased by roughly 10%, during the period.

*The financial results indicated that the company's long-term borrowings stood at N6.60 billion. Cadbury’s total assets are now at N43.69 billion, net assets grew marginally by 0.64% to N13.64 billion.

Cadbury NIG PLC’s earning per share (EPS) was N24.00, a 52% decrease from N50.00 in FY 2020.

The company traded at N9.00 per share and has grown by 2.27% from year-to-date.