UAC of Nigeria (UACN) Q2 2024 earnings summary

Executive summary

• Revenue for H1 2024 was NGN 83.3 billion, up 57.5% year-over-year, with profit before tax at NGN 15 billion, driven by strong operating performance, volume growth, disciplined pricing, and efficiency initiatives.

• Net profit rose to NGN 9.54 billion, and EPS increased to 304 kobo from 53 kobo year-over-year.

• Growth and profitability attributed to leadership recruitment, group structure simplification, strategic clarity, and technology investments.

• Maintained strong market positions and brand leadership, launching new products like Kingsway Sausage Roll and Gala Chin Chin.

• Continued investment in talent, operational improvements, and technology to sustain growth and margin expansion.

Financial highlights

• Revenue grew 57.5% year-on-year to NGN 83.3 billion; gross profit up 117% to NGN 18.7 billion; profit before tax rose to NGN 15 billion from NGN 3.2 billion in H1 2023.

• Operating profit reached NGN 6.7 billion, reversing an operating loss of NGN 35 million in H1 2023.

• Free cash flow generated was NGN 6.3 billion; return on invested capital stood at 28%.

• Net assets increased by NGN 8.4 billion to NGN 61.6 billion; net cash position of NGN 7.9 billion as of June 30, 2024.

• Gross margin expanded by 617 basis points to 22.5%, driven by pricing initiatives and cost management.

Outlook and guidance

• Management remains focused on sustaining high growth, improving margins, and operational efficiency through continued investment in talent and technology.

• No specific earnings guidance provided, but Q4 is historically the strongest quarter.

• Dividend policy remains stable, with future changes dependent on performance, outlook, and capital needs.

• Internal controls assessed as effective as of June 30, 2024.