Honeywell records N58bn revenue in 9 months

Honeywell records N58bn revenue in 9 months

By Anthony Okafor

Honeywell Flour Mills Plc has announced N58.2 billion revenue for the nine month period ended December 31, 2019, represents six percent increase compared to N55 billion revenue posted in the same period in 2018.

This is even as the company said that it plans to sustain revenue growth through increased utilisation of the pasta production facility at Sagamu, Ogun State.

The result released to the Nigerian Stock Exchange (NSE) showed that operating profit also rose by 19 percent to N3.4 billion from N2.8 billion in 2018.

The growth in revenue, according to the company, was driven by corresponding growth in sales volume, which rose by percent.

The company further stated that efficient management of input costs and operating expenses also led to a healthy gross margin of 17.6 percent and the nine-month operating profit increase of 19 percent.

Commenting, Lanre Jaiyeola, Managing Director, Honeywell Flour Mills, said: “Despite the challenging operating environment occasioned by rising input costs, reducing spending power of consumers and product evacuation challenges due to the traffic logjam at Apapa, we grew our nine months revenue by six percent to N58.2 billion when compared to revenue of N55 billion recorded in the corresponding period of 2018. This was driven by sales of our various Flour and Pasta products.

“In line with our objective to continuously improve operational efficiency, the execution of well–embedded operational efficiency initiatives led to 9-month operating profit accelerating at a faster rate than revenue by 19% from N2.8 billion to N3.4 billion. We will continue to improve our operational efficiency in order to maximize value to shareholders.”

He, however, stated that the growth in operational efficiency was moderated by the increase in finance expense, which was up 60 percent to N4.2 billion from N2.6 billion in the previous year.

He stated that the increase in finance expense was as a result of the cost of financing part of the Foods and Agro-allied complex which is now being charged into the Income Statement following the commencement of commercial operations. “As a result, profit for the 9-month period reduced by 747% from N143 million to a loss of N925 million,” he said.

“We are confident that our performance in the coming quarter and the new financial year will record significant improvement. We have implemented strategies to maximize shipment of products to our customers in spite of the Apapa traffic gridlock. We are also well positioned to substantially increase our capacity utilisation of the Pasta production through continuous flow of input materials to the Pasta factory in Sagamu. We are also working on the introduction of new products tailored towards the preference of our most valued consumers in terms of satisfying their nutritional needs, taste and spending power,” he added.

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