Dangote Flour Mills Consolidates  Performance  with N9.5bn Profit
By Goddy Egene

Dangote Flour Mills (DFM) Plc has consolidated its performance with an impressive bottom-line for the 12 months ended September 30, 2016. The company, which was sold by Dangote Industries Limited (DIL) to Tiger Brands of South Africa before it was re-purchased by DIL, had recovered from loss position at nine months ended June 30, 2016. The company had posted a profit before tax (PBT) of N2.64 billion compared with a loss of N9.55 billion posted the corresponding period of 2015.
And when the company released its 12 months results, it showed a highly improved performance, showing PBT of N5.542 billion in 2016, as against a loss of N12.679 billion in the corresponding period of 2015.
An analysis of the results showed that DFM ended the period with a  revenue of N78.1 billion in 2016, up from N48.03 billion. Distribution and administrative expenses was reduced from N8.917 billion to N7.988 billion in 2016. Finance cost was also reduced from N3.891 billion to N3.184 billion. Hence, PBT improved to N5.542 billion from a loss of N12.679 billion.
Reviewing the results, analysts at Dunn Loren Merrifield, an investment banking firm, said the strong performance for the year and return to profitability was driven largely by several restructuring strategies adopted by the company, which include the reopening of the closed DFM in Kano with plans to grow wheat in the state, as well as reconstitution of new Board of directors and management.
“With the performance thus far, the company appears to be out of the woods. Overall, the strong 2016 performance showed improvement in the company’s underlying fundamentals and intrinsic business value. We will be reviewing our valuation on the company and will communicate accordingly,” the analysts said.
The Group  Chief Executive Officer of DFM, Thabo Mabe had attributed the return to  profitability  to strategies.
According to the return to profitability follows several strategies adopted by the company to increase market share and create value for shareholders. He said that the flour mill is driven by the vision of putting its products on the table of every Nigerian.
Soon after the repurchasing the company, DIL made fresh efforts to  reposition the firm, return it to profitability and deliver returns to shareholders like others in the group. The first move was ensuring a new corporate governance  strategy.  In this regard, Aliko Dangote left the board, while Asue Ighodalo, a renowned corporate lawyer and Chairman of Sterling Bank Plc  was appointed as its new chairman.