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Tuesday, March 28, 2023

Cadbury Maintains Growth Momentum as Third Quarter Profit Surges

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Cadbury Nigeria Plc continued strong performance in the third quarter that reflects positive momentum on several fronts, as the company plans to invest $600 million on sustainable cocoa farming.

It is important to understand that the improvement in earnings amid a challenging macroeconomic environment is driven by volumes and not prices, which validates the strategies of management and board of directors.

The beverage producer has released its third quarter results that shows improvement in key performance ratio.

For instance, net income spiked by 38.49 percent to N2.81 billion in September 2022 from N2.02 billion as at September 2021.

Revenue was up 41.61 percent to N42.54 billion in the period under review from N30.04 billion the previous year.

The beverage confectionery segments remain the major driver of revenue even as consumers are cutting down on spending due to inflationary pressure and huge transportation and utility bills.

Nigeria’s inflation rate reached an all-time high of 20.77 per cent in September 2022, from 20.52 per cent recorded in August of the same year.

Despite rising input costs, Cadbury Nigeria saw operating income surge by 81.86 percent to N3.31 billion in the period under review from N1.82 billion as at September 2021.

It effectively managed direct cost attributable to projects as gross profit was up 48.93 percent to N8.37 billion in the period under review from N5.62 billion as at September 2021.

The consumer goods giant’s sales are enough to cover costs as gross profit increased to 19.67 percent in the period under review from 18.70 percent the previous year.

The strong growth in earnings is a boon for shareholders who are expecting to be rewarded in the form of dividend payment.

Company Information

Cadbury Nigeria Plc is a Nigeria-based manufacturer and seller of fast- moving consumer goods to the Nigerian market, but also for exports in West Africa. The Company also produces a range of intermediate products, such as cocoa butter, liquor, cake and powder.

The cocoa butter, cake and liquor are exported to a wide range of international customers. The Company’s brands fall into three principal categories, namely Refreshment Beverages, Confectionery and Intermediate Cocoa Products.

CADBURY BOURNVITA, CADBURY 3-in-1 HOT CHOCOLATE, are the main brands in the refreshment beverage category. TOMTOM CLASSIC, CANDY CARAMEL, CANDY COFFEE, BUTTERMINT AND CLORETS are the main brands in the confectionery stable.

COCOA POWDER, COCOA CAKE AND COCOA BUTTER are the main products for the Intermediate Cocoa Products. The Cocoa Processing Plant in Ondo State produces a range of intermediate products, such as cocoa butter, liquor and powder.

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