FULL YEAR RESULTS: FLOWERS IN FLOUR MILLS RESTRUCTURING.

Flour Mills of Nigeria PLC has once again harvested nice flowers from its ongoing group restructuring.

According to audited figures for the year to March released this week,  Flour Mills once again reaped bountifully from sale of a subsidiary to end the year with better margin.

In 2015 financial year, Flour Mills had recorded capital gains of N14290m from asset disposal as part of ongoing restructuring to guarantee its closing N7724.8m profit before tax.

In the year to March 2016, N22397.8m was gained from similar disposal and it helped ensure N11489.3m profit before tax for the year.

Hitherto, management gallant efforts to control cost had been destabilised by N7720.5m net losses from non core operations as against only N685.1m loss therein in 2015 year.

Flour Mills had successfully kept cost of sale growth by 11.5% to N304961.7m within range of increase in core revenue by 11% to N342586.5m and even behind 12.9% increase recorded in total income to N367421.4m.

Then effective grip on overhead led to 21.9% drop to N15848.3m for administration expenses.

However, with selling and distribution cost growing by 19.6% to N5003.8m, operating profit dropped by 11.4% to N9052.1m before the asset disposal gain came in very handy.

But then, its full impact was watered down by 19.8% increase in finance costs to N22397.8m from N18703.5m and 52.1% decrease in investment income to N1103.5m.

Hence Flour Mills settled for 48.7% increase in profit before tax and a closing 3.13% profit margin compared to 2.37% in 2015 year.

The capital gain was recorded from the sale of Unicem and Group Managing Director, Paul Miyonmide Gbededo said in an accompanying press statement:

"The good news is that management is determined to further restructure our operations, streamline our business operations, to focus on core businesses and consequently monitor and manage our costs optimally to hedge against further economic challenges which might evolve"

FLOUR MILLS: Nbn
                     2016.    2015
Total inc.     367.4.    325.4
Core inc.     342.6.     308.8
C. Of sale    305.0.     273.4
Selling etc    5.04.       4.18
Admin.         15.8.      20.3
Net op. Gain(7.72).  (0.69)
Op. Profit.    9.05.      10.2
Inv.income  1.10.     2.30
Fin. Cost     22.4.      14.3
Profit.          11.5.       7.72
Margin %      3.13.      2.37
                   

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