Honeywell Flour Mills Plc has raised the hopes of its shareholders for an impressive first dividend after its listing as the company announced a profit growth of 307 per cent for the third quarter ended December 31, 2009.
The flour milling company accessed the nation's capital market last year in the heat of the bear run, succeeded with the initial public offering (IPO) and got its shares listed on the NSE last October. And as investors look forward it's the declaration of its first full year results to March 31, 2010, the company last week reported an impressive Q3 results.
According to the results made available by the Nigerian Stock Exchange (NSE), Honeywell Flour posted a turnover of N26.2 billion for the Q3 of 2009, indicating a growth of 24 per cent above the N21.1 billion recorded in the corresponding period of 2008. However, profit after tax soared by 307 per cent or N657 million from N214 million in 2008 to N871 million in 2009. Apart from overcoming the tough challenging business environment to post improved results in Q3, the directors have projected a profit after tax of N1.771 billion for the full year ending March 31, 2010. Comparably, the Q3 growth of the company is better than 221 per cent recorded in Q2.
Commenting on the Q2 results, the Managing Director of the company, Mr. Babatunde Odunayo, had attributed the impressive performance to the reduction in energy costs occasioned by the inauguration and deployment of the Gas Plant in the production facility of the Flour Mills business. He also cited an increase in margins from additional volumes in Semolina and the new wheat meal businesses, increase in overall volume and turnover, and efficient cost saving mechanisms the company deployed.
He had assured that the performance would be sustained through the last of the company's financial year, adding that strategies have been put in place to further expand products line and deepen its market share.On the growth strategies of the company, he said that said that besides introducing new products, the company would increase its focus on cost reduction through continuous integration of the Honeywell Superfine Foods business, which will continue to provide revenue and costs synergies.
He said: “Another growth mechanism is improving product quality through qualitative research and development to produce more attractive and better quality wheat and grain based products. Expansion of the Semolina business production capacity is the third pillar of the expected growth,” Odunayo said.