NINE MONTHS RESULTS: DANGOTE FLOUR BOUNCES BACK.

Dangote Flour Mills PLC is bouncing back from the loss league after accumulating losses for quite a while. Incidentally, the recovery is coming after name change back to its original name.

According to figures for nine months to June released recently, Dangote Flour mills recorded 50.6% increase in core revenue to N40849.2m while direct cost of generating this grew by only 17.5% to N35820.5m.

This set the stage for leap in gross profit to N14028.7m thus laying a good foundation for good overall harvest within the period.

Yet, the goodies had in fact just begun flowing. As a follow up, interest income rose by multiples to N228.8m and income from other sources rose by 154.5% to N68.2m.

It turned out too that effective grip on cost of sale was not an isolated case. Other cost units in fact went down.

Financial charges decreased by 10% to N2294.7m while distribution and general administration cost less by 8.08% at N5632.4m.

Most of the goodies gathered .momentum in the third quarter to June as core and other revenue heads more than doubled levels achieved in the third quarter in 2015 year.

Thus, with the third quarter closing with 7.41% profit margin, the full nine months margin came to 5.27% since the bulk of the reaping took place then.

But then, the full nine months figure still represented strong recovery from the 28.8% loss margin reported within the same period in 2015 year.

Of course, the new capital injected helped a lot especially in reducing long and short term borrowing considerably and enriching the cash too.

But deficit working capital is still in place although down by more than half on levels by 2015 nine months.

DANGOTE FLOUR MILLS: Nm. Nine months
                      2016.      2015
Total inc. 50146.2. 33132.3
Core inc. 49849.2. 33102.5
C of sale 35820.5. 30485.3
G. Profit. 14028.7.   2616.2
Other inc.    68.2          26.8
Overhead 5632.4    6127.7
Fin. Cost  2294.7.   6127.7
Interest.     228.8.        3.13
Profit       2643.6.  (9554.4)
Margin %  5.27.      (28.8)
W.Capital (13269) (26970)

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