Cadbury Nigeria Down by 11%, Market Cap Shrinks to N31.7bn
Cadbury Nigeria Plc’s market valuation plunged by 11.05% as investors dumped large amounts of shares held in the fast moving consumer goods category king. The segment has seen some margin dilutive development amidst households’ tight wallets and rising rivalry among key players.
The company’s share price declined to N16.90 on Friday, according to data obtained from the Nigerian Exchange, from N19 at the close of the trading session in 2023. This left its market value at N31.74 billion, according to data from the Nigerian Exchange.
In 2023, Cadbury Nigeria faced a tough time in its operating activities following the devaluation of the naira in June. This resulted in higher costs for the company whose foreign currency liabilities jumped after a large devaluation of the local currency last year.
The company’s net finance costs rose due to FX losses, and this had negative effects on the fast-moving consumer company’s profitability in the period.
As pressures heightened, Cadbury Nigeria reported N10.24 billion as a loss in 9M 2023 from N2.8 billion posted in the comparable period.
While the market expects there will be a light at the end of the tunnel, the local currency has yet to survive US dollar dominance in the foreign exchange markets. The naira has failed to converge despite the devaluation.
Analysts said companies operating in the FMCG sector are walking on a tightrope until the apex bank achieves currency stability as the naira lost its allure. Dangote Reacts to EFCC Visit to Headquarters
Earnings
Cadbury Nigeria Plc’s revenue rose by 39.2% year on year to N59.2 billion, details from its 9M-2023 unaudited financial statement showed. In the comparable period, the company posted N42.54 billion as revenue.
The breakdown showed that revenue from Refreshment Beverage, Confectionary and Intermediate Cocoa Products rose by 106.6%, 54.6% and 169.7% to N41.08 billion, N13.88 billion and N3.02 billion.
Analysts noted that the company’s new product line, biscuits recorded N1.04 billion in revenue in 9M 2023.
