Honeywell Flour Mills PlcÂ Â Â has recorded a profit before tax of N5.5 billion for the year ended March 31, 2017, compared with a loss of N2.8 billion in 2016.
According to the audited results,Â Â Â the company posted revenue of N53.2 billion, up by about five from N50.9 billion recorded a year ago. This increase in turnover was achieved despite the general squeeze on consumer spend due to macroeconomic headwinds experienced nationwide in 2016. The company explained that itÂ Â Â implemented forward looking strategies aimed at input cost management and efficiencies in the overall supply chain management process.
As a result of this, cost of sales declined by 13 per cent to N40.5 billion compared to N46.5billion recorded in the previous year.Â Â The companyâ€™sÂ Â operating profit grewÂ Â to N8.3 billion following managementâ€™s execution of tactical initiatives in the companyâ€™s supply chain, sales and marketing functions to improve cost-to-serve metrics across modern trade and informal market channels in all business segments of the company. This led to a 23 per cent reduction recorded in selling and distribution costs inÂ 2017.
However, there was a significant increase in net finance costs borne byÂ the companyÂ Â in the period amounting to about N2.0 billion when compared to the previous period. According to the company this was reflective of the increased cost of doing business in an environment characterised by uncertainty and more conservative banking industry.
Commenting on the results, the Managing Director of Honeywell Flour Mills,Â Â Mr. â€˜Lanre Jaiyeola, said: â€œThese results were achieved as a result of our determination to exceed the expectations of all stakeholders. Despite a challenging environment, we focused on delivering superior quality products to our wide-ranging customers in the retail and wholesale segments whilst leveraging our route to market capabilities which we continue to invest in. In addition, we took a very conservative approach to costing and also leveraged government policies targeted at helping the manufacturing sector during the forex crisis. Our management team is making significant changes to our business in order to lay a better platform for the years ahead. Therefore, in FY2018 and on the heels of an improving economic environment, we expect to record further improvements in performance, reigniting our growth agenda and extracting increased efficiency and cost reduction through a recently launched companywide transformation and continuous improvement program.â€