Lagos, Nigeria; October 30, 2017.
Flour Mills Group, the market leader in food and agro-allied products in Nigeria, today announces its unaudited 2017 half year results with continued growth through most segments of the business.

Key Highlights

Flour Mills Group (The Group):
• Revenue was N298.44 billion for the six months ended 30th September 2017, an increase of 17% when compared with N255.30 billion of the same period last year.
• Profit Before Tax was N13.48 billion as against N8.80 billion for the same period in 2016.
• Profit After Tax was N9.36billion, compared to N6.46 billion for the same period in 2016.

Flour Mills of Nigeria Plc (The Company):
• The Company recorded a revenue of N216.77 billion an increase of 16% when compared to N186.07 billion for the same period in 2016.
• It recorded a 51% increase in Profit before tax at N12 Billion compared to N8 billion for the same period in 2016.
• Finance cost increased (vs previous year) mostly due to higher interest rates.

Commenting on the result, the Group Managing Director, Paul M. Gbededo, stated:

“Our half year results show continued growth through most segments of our businesses, especially in the food business, delivering strong top and bottom line financials in line with our objectives.

“The Group recorded growth from volume and product mix. This growth was despite what continued to be a challenging business environment.

“Overall, the business shows an impressive performance in the first half of the year. We are positive that we are on track to meet our growth targets for the remaining part of 2017/18 financial year.”

Operational review
The food business value chain was responsible for an increase of N40bn of the Group’s turnover. The Chief Finance Officer (CFO), Mr. Jacques Vauthier, in his comment, said that the Management of the Company was confident that this sector will record even stronger performance as the year progresses. He stated further, “To this end, we are enhancing our marketing activities to push the brand’s presence into newer outlets while strengthening present market share.”

The Head, Corporate Business Development, Mr. Sadiq Usman, stated that, in the agro-allied division, the Group’s focus will remain on developing competences and improving execution capacity to backwardly integrate its core value chains; Sugar sweeteners, edible oils, feeds & proteins and Cassava starches. He further said, “the Group will leverage its significant resources and continue to build the capacity of local farmers and farming groups, who are an integral part of our strategy to develop sustainable, locally-focused supply chains.”

As part of a strategic measure to consolidate operations, create value for shareholders and enhance administrative and operating efficiencies, the company in Q2 2017, announced the completion of a merger and absorption of Golden Penny Rice Ltd, a wholly owned subsidiary, into Flour Mills of Nigeria Plc. It is expected that the restructuring will meaningfully improve the synergies of the Group, reduce costs and improve the competitiveness of the company’s products, with the aim of advancing the profitability of the Group.

The Company is in the process of issuing the first tranche of the Shelf Registered Rights Issue fund raising program. The program which was registered in 2016 is to raise up to N40 Billion in equity funds. In addition, the CFO informed that the Company has started the registration of a N70 billion Medium Term Notes program to refinance debts and lower the cost of borrowing.
On his part, the Company Secretary/Director, Legal Services, Mr. Joseph Umolu, stated:

“To combat the traffic challenges posed by the difficult road conditions in Apapa that have negatively impacted business logistics and, correspondingly, our performance, and to generally aid the ease of doing business in Apapa, FMN Group is partnering with other stakeholders (with a contribution of about N750 million) to rehabilitate Apapa Wharf Road and manage the traffic congestion in Apapa. This is as part of our Group’s Corporate Social Responsibility.”

Performance Summary

Group Company
6 Months ended 30th SEPTEMBER 2017 6 Months ended 30th SEPTEMBER 2016 6 Months ended 30th SEPTEMBER 2017 6 Months ended 30th SEPTEMBER 2016
N ’Billion N ’Billion % Change N ’Billion N ’Billion % Change
Revenue 298.44 255.30 17 216.77 186.07 16
Cost of sales (262.93) (218.88) 20 (189.74) (161.04) 18
Gross profit 35.51 36.42 -2 27.03 25.03 8
Selling and Dis. expenses (2.77) (3.07) (10) (2.40) (2.92) (18)
Administrative expenses (8.35) (6.07) 38 (5.87) (4.12) 42
Net Operating gains and losses 5.07 (8.02) (163) (1.43) (3.71) (61)
Investment Income 0.27 0.53 (49) 6.28 0.67 837
Finance Cost (16.27) (10.93) 49 (11.55) (6.96) (66)
Profit before tax 13.48 8.80 53 12.06 8.00 51
Profit after tax 9.36 6.46 45 8.70 5.76 51

About Flour Mills of Nigeria Plc
Incorporated in September 1960 and quoted on the Nigerian Stock Exchange since 1978, Flour Mills of Nigeria (FMN) Plc. is one of Nigeria’s leading food and agro-allied companies. With a broad basket of food products, an iconic brand “Golden Penny” and a robust pan-Nigerian production, distribution, and supply chain network, FMN is a fully integrated and diversified food and agro-allied group.

The FMN group strives in its mission to “Feed the Nation, Everyday” through its five core food value chains: Grains, Sweeteners, Oils and Fats, Proteins, and Starches. FMN creates value along the entire food chain with its “farm-to-table” model by providing inputs and know-how to farmers, aggregating and sourcing crops and raw materials to supply its world-class processing facilities across Nigeria, and distributing its innovative food brands to its customers.

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