Nigerian billionaire Abdul Samad Rabiu’s food business posts $156.5 million in profit in 9M 2022

BUA Foods Plc, a consolidated food conglomerate led by Nigerian billionaire Abdul Samad Rabiu, reported a profit of N68.8 billion ($156.54 million) at the end of the first nine months of its 2022 fiscal period, closely mirroring BUA Cement Plc’s strong performance.

BUA Foods operates as the unified food business segment of the Nigeria-based BUA Group. Its operations include the activities of BUA Sugar Refinery Limited, BUA Oil Mills Limited, IRS Flour, IRS Pasta, and BUA Rice Limited.

Rabiu and his son own 99.8 percent of the newly established food business segment.

Despite challenges in its operating environment, particularly a surge in raw materials prices, the group’s profit during the nine-month period of its 2022 fiscal year rose by more than 17 percent from N58.7 billion ($133.6 million) in the corresponding period of 2021 to N68.8 billion ($156.5 million).

The double-digit increase in the group’s earnings can be attributed to a surge in food demand as both household and industrial consumers stocked up on food items in anticipation of further price increases.

This resulted in an increase in the sales of the majority of its products, which include sugar, pasta, bakery flour, and wheat bran.

As a result of the increase in product sales, the group’s revenue rose by more than 20 percent during the period under review, from N241.1 billion ($548.8 million) in the first nine months of 2021 to N289.8 billion ($659.7 million).

The group’s cost-cutting strategies also paid off handsomely, as administrative expenses fell significantly, offsetting a portion of the 32-percent increase in marketing and distribution expenses.

As a result of the group’s strong financial performance, retained earnings increased from N192.7 billion ($438.5 million) to N198.4 billion ($451.5 million) despite paying a dividend of N64.5 billion ($154 million) to Rabiu and minority shareholders at the end of its fiscal year in 2021.