Cadbury Nigeria Plc Q2 2025 – Earnings Momentum to Strengthen as Cocoa Prices Ease

Event

Cadbury Nigeria Plc (the Group) delivered an impressive performance in the second quarter of 2025, with revenue rising by 44% to N40.02 billion from N27.75 billion in Q2 2024. The topline growth reflects the success of recent pricing adjustments and sustained demand across its core product categories, particularly in the domestic market.

The refreshment beverages segment remained the major growth driver, expanding by 58% year-on-year and accounting for 64% of total revenue. Confectionery followed closely, advancing by 72% and contributing 32% of total revenue. However, the intermediate cocoa products segment weakened, falling by 52% and representing only 3% of total revenue.

Outlook

We project a profit after tax of N20.66 billion in FY 2025, compared to a loss after tax of N22.23 billion in FY 2024. Additionally, we anticipate a mild dividend payout ratio of 10% on EPS, marking a return to shareholder distribution after two years of suspension due to negative earnings.

Consequently, we raised our fair value estimate to N86.74 (previously N67.51). With the stock currently trading at N69.00, this implies a potential total return of 27%. We therefore maintain a BUY recommendation on the stock.

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