Event

In 2024 fiscal year, Flour Mills Nigeria Plc (“the Group”) struggle with converting top-line growth into profitability worsened, as net profit plummeted by 88%, despite significant revenue growth achieved. This constrained profitability was  largely due to significant foreign exchange losses incurred.

Buoyed by strong revenue performance in the Food segment (+51%), Agro allied segment (+17%), Sugar segment (+84%), and Support segment (+39%), total revenue surged by 49% to N2.29 trillion (FY 2023 N1.53 trillion).

Outlook

We project a revenue growth of 29% to N2.96 trillion for FY 2025. This projection is anchored on anticipated pricing adjustments and volume growth. We expect the volume growth to be driven by supply chain optimisation, increased exports, and sustained customer engagement which is poised to boost product penetration.

Overall, we revise our fair value for the stock to N39.62 (previous: N36.36), however, we maintain a HOLD recommendation for the stock, as our fair value offers a 4% total return.

Please follow the link “Flour Mills of Nigeria FY 2024 – Operating Profit Dampened by FX Loss” to view the whole report.

                                    Thank you.