UAC of Nigeria Recovers from N9.3bn Loss, Records N4.3bn Profit

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By Goddy Egene

UAC of Nigeria Plc has recorded a profit of N4.3 billion for the year ended December 31, 2020. This represents a recovery from a loss of N9.3 billion posted in 2019.

Earnings per share for year stood at 106 kobo, up from negative 183 kobo in 2019, thereby raising the prospects of a higher dividend for shareholders.

Details of the unaudited results showed that turnover increased three per cent to N81.6 billion from N79.202 billion recorded in 2019. According to the company, the revenue was supported by sales growth in the Animal Feeds & Other Edibles segment (+4.6 per cent), the Packaged Food & Beverages segment (1.8 per cent) and the Quick Service Restaurant Segment (1.9 per cent).

UACN explained that these segments were deemed essential services during the period of stringent restrictions to movement of people and goods to curtail the spread of COVID-19.

Total profit for the period was N4.3 billion in 2020, a reversal from the N9.3billion loss reported in FY2019. Earnings per share for FY2020 was 106kobo, up from negative 183 kobo in FY2019.

Commenting on the performance, Group Managing Director, UACN, Fola Aiyesimoju, said: “FY 2020 was challenging, with operational disruptions related to COVID-19 and ENDSARS protests. I thank my colleagues across the group for their courage, sacrifice, and dedication in navigating complexity. We focused on executing our strategy, implementing initiatives relating to UACN Property Development Company Plc (UPDC), significantly reducing leverage and increasing cash, strengthening management, and driving profitability.”

According to him, operating performance for the year was negatively impacted by disruptions as well as input cost escalation.

“Our efforts resulted in net income of N4.3 billion in 2020. We benefited from N1.2 billion in non-recurring gains from investments in associates, MDS Logistics Limited and UPDC. In the fourth quarter, our businesses rebounded and profit after tax increased 136 per cent to N2.4 billion (N1.4billion, adjusting for non-recurring items) from N1.0 billion in 2019, supported by cost management initiatives that reduced operating expenses by N1.4billion(30 per cent).In December 2020, UAC received 649 million units of UPDC Real Estate Investment Trust , valued at N3.6 billion as part of the partial exit from UPDC. This is in addition to the N6.6 billion received in H2 2020 for the sale of a 51 per cent stake in UPDC.

Meanwhile, the stock market recorded another decline yesterday as profit-taking continued. The Nigerian Stock Exchange (NSE) All-Share Index decline 0.74 per cent to close at 42,043.79.