Cadbury Nigeria Plc (NSE: CADBURY) on Wednesday 29, 2020 released it unaudited interim financial information for the half year ended 30 June, 2020 to the Nigerian Stock Exchange and the investing public.
The company booked a revenue of N15.917 billion in the half year, 18.18% decline from N19.454 billion recorded in H1 2019. The revenue from domestic sales declined from N17.349 billion (H1 2019) to N13.283 billion, while the revenue from export sales increased from N2.104 billion (H1 2019) to N2.633 billion in the period in review.
The cost of sales was reduced at approximately the same rate, thus the Gross profit declined by 20.12% from N4.141 billion recorded in H1 2019 to N3.308 billion in H1 2020. This represents a 20.78% Gross Profit Margin, approximately the same as the 21.29% margin recorded in H1 2019.
For the H1 Period, January to June 2020, the company’s profit after tax declined by 19.89%, from N669.938 million to N536.660 million, while the earnings per share dropped by 7 kobo, from 36 kobo to 29 kobo.
A review of the company’s balance sheet shows a total assets of N32.831 billion as at 30 June, 2020. This is a 13.93% increase in the total asset of N28.801 billion recorded as at 31 December 2019. The increase in the assets is attributable to increases in Inventories and cash and cash equivalents.
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The total liabilities increased by 28.91% to N19.640 billion from N15.235 reported in the preceding year. The increment was driven by an increase in the trade and other payables, which went up from N9.617 billion recorded in H1 2019 to N14.154 billion in H1 2020.
The total Shareholder equity declined by 2.77% to N13.190 billion from N13.566 billion reported in the preceding year.
A review of the statement of cashflows shows the company has turned around its cash constraints, as it went from a negative cashflow from operating activities in 2019, to a positive cashflow in 2020.
- Net cash generated from operating activities went from minus N418.055 million in 2019 to N3.181 billion in 2020.
- Net cash used in investing activity decreased from N315.381 billion in 2019, to N146.297 million. The company spent less money in the acquisition of property, plant and equipment in the period in review.
- The net cash used in financing activities increased from N471.429 billion in 2020 to N928.059 billion, due to the increase in dividend payout to shareholders. For the 2019 financial year, CADBURY increased its final dividend to N0.49 per ordinary share, almost double of the N0.25 dividend paid per ordinary share for the 2018 financial year.
Reviewing the performance of the company in the second quarter period; April to June, shows that the reported revenue declined by 27.60% from N10.171 billion to N7.363. CADBURY reported a loss of minus N102.276 million in the quarter, down 162.67% from the N163.185 million profit reported in Q2 of 2020.
Cadbury Nigeria Plc is a company domiciled in Nigeria. The address of the Company’s registered office is Lateef Jakande Road, Ikeja, Lagos. The Company is principally engaged in the manufacture and sale of branded fast moving consumer goods mostly to the Nigerian market, but also for exports.
The Company’s brands fall into three principal categories, namely: refreshment beverages, confectionary and intermediate cocoa products. Cadbury Bournvita and Cadbury 3-in-1 hot chocolate are the refreshment beverages, Tom Tom, Buttermint and Clorets gum are the Confectionery products while Cocoa Butter is a key product in the intermediate cocoa category.
Analysts at Investogist have a SELL rating on this stock, with a fair value range of N4.75 – N5.70.