Consumer goods giant Unilever Nigeria Plc (NGX: UNILEVER) has released its unaudited interim financial results for the six months ended June 30, 2026, delivering top-line revenue growth across its core product lines despite input cost inflation and overhead pressures.
Gross turnover for the half-year window expanded 22.2% year-on-year to ₦119.9 billion, up from ₦98.1 billion in H1 2025. Topline performance was led by the Foods division, which surged 31.3% YoY to ₦77.1 billion, now generating 64.3% of total enterprise sales.
The Beauty & Wellbeing segment posted strong growth, expanding 21.0% YoY to ₦12.0 billion, while the Personal Care division recorded a 4.7% rise to ₦31.0 billion.
Operating Margin Expands Despite Rising Marketing and Input Costs
Cost of Goods Sold (COGS) grew 16.4% YoY to ₦65.2 billion, driven by higher raw material costs and imported ingredient pricing. However, because turnover outpaced production cost growth, gross profit expanded to ₦54.7 billion, lifting the gross profit margin by 270 basis points to 45.6% (compared to 42.9% in H1 2025).
Selling, General, and Administrative (SG&A) expenses rose 29.8% YoY to ₦31.2 billion. This was primarily driven by a 25.6% surge in marketing and administrative expenses to ₦26.4 billion, as management increased brand awareness campaigns and route-to-market investments.
Despite these higher operational outlays, disciplined cost control pushed the operating profit margin up to 20.3% from 19.2% in H1 2025.
Exchange Losses and Tax Expense Weigh on Bottom-Line Growth
Below the operating line, net finance income declined 9.8% YoY to ₦4.8 billion. Although interest earned on substantial cash deposits rose 11.8% to ₦6.5 billion, finance costs jumped 3.5x to ₦1.7 billion. This sharp rise was caused by a ₦1.3 billion foreign exchange revaluation loss on bank balances.
A higher tax provision of ₦13.6 billion (translating to a steep 46.5% effective tax rate) moderated net income growth. Consequently, Profit After Tax (PAT) closed at ₦15.6 billion, up 8.3% YoY.
On a standalone basis, Q2 2026 PAT dipped 3.1% YoY to ₦8.6 billion. Although Q2 revenue grew 18.8% and operating profit expanded 22.1% to ₦12.9 billion, a 57.8% surge in Q2 tax charges (₦7.2 billion) compressed quarterly net earnings.
Interim Dividend Quadruples to ₦2.00 per Share
Despite the single-digit increase in net profit, the Board of Directors declared an interim dividend of ₦2.00 per ordinary 50k share. This payout represents a 300% increase over the ₦0.50 per share interim dividend paid in H1 2025, totaling ₦11.5 billion in cash distributions to shareholders.
The dividend payout reflects the company’s strong cash position, with cash and cash equivalents standing near ₦97.2 billion. Management reaffirmed its focus on local raw material sourcing and route-to-market execution to sustain profitability through the second half of 2026.
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