Unilever Nigeria Gains 18.4% after Solid Earnings Growth
Consumer goods company Unilever Nigeria Plc gained 18.4% or N20.107 billion, as the company’s earnings growth boosted investors’ confidence in the equities market.
Data from the Nigerian Exchange (NGX) platform showed that the consumer goods company share price inched higher to N22.5 on Friday over active trades.
The gain lifted Unilever Nigeria Plc’s market value to N129.262 billion as a result of more than N20 billion weekly increase gain. Unilever Nigeria share price was N19 at the beginning of trading session last week.
After its earnings release, demand for the company shares increased as investors trading highs and lows ramped up Unilever Nigeria shares on the trading platform.
Unilever Nigeria Plc profit grew by more than 559% year on year to N11 billion, details from the consumer goods company unaudited financial statement released last week showed.
This significant jump has been attributed to the elimination of losses from discontinued operations and reduction in tax expenses compared to 9M 2023
In the period, the company saw about 46% year-on-year growth in revenue, which printed at N103.848 billion from N71.206 billion in the comparable period.
The company’s cost of sales grew at a slower pace to revenue, according to analysts, increasing by 25.8% year on year to ₦60.96 billion from ₦48.45 billion in the comparable period in 2023.
“This growth was moderated by revaluation gains of circa ₦4.73 billion on the company’s foreign currency-denominated balances. As a result, the cost-to-sales ratio improved to 58.7% in 9M 2024, from 68.0% in the previous year,” CSL Stockbrokers said in a review.
Net finance costs amounted to ₦3.8 billion in 9M 2024, representing a 40% increase compared to ₦2.7 billion in 9M 2023. These costs were primarily due to interest on third-party bank loans, indicating relatively stable financing arrangements.
PAC Capital Limited said Unilever Nigeria performance for 9M 2024 reveals strong growth momentum, driven by robust food product sales and strategic operational shifts.
Analysts said the remarkable profit increase reflects effective management of discontinued operations and improved tax efficiencies.
This performance positions Unilever favorably for further growth, with potential opportunities to expand the Beauty and Wellness segment to enhance diversification, PAC Capital Limited said in a note. #Unilever Nigeria Gains 18.4% after Solid Earnings Growth
