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Guinness, Flour Mills declare improved results


February 14, 2006/punch


Guinness Nigeria Plc on Monday announced an increase of 42 per cent in profit after tax for the six months ended December 31, 2005, while Flour Mills Nigeria Plc recorded a growth of 149 per cent in net profit after tax for the nine months ended December 31, 2005.

The unaudited financial results were made available to stockbrokers on the trading floor of the Nigerian Stock Exchange.

Details of the results, obtained by our correspondent, showed that Guinness posted 17 per cent rise in turnover from N23.283billion in 2004 to N27.299billion in 2005.Profit before tax grew from N5.417billion to N5.772billion, while profit after tax rose by 42 per cent from N2.761billion to N3.925billion.

Market operators said that the improved performance might have resulted from the strategic products innovation Guinness embarked recently.

Apart from changing the bottle of its premium brand, Stout, the company introduced another variant and upgraded some other of its products. Although the Guinness paid lower dividend in 2005 due to an exceptional cost of N3.369billion resulting from the change of bottle, the Chairman of the company, Chief Ralph Alabi, gave assurance to investors that 2006 would yield better results.

“The year 2006 will continue to the be challenging, on our part we shall continue to focus on innovation in our brands and processes and increase efficiencies in our operations. With concentrated attention on these areas, I am confident of growth in the business and in shareholder value,” Alabi said in his report to shareholders in 2005.

Impressed by the results, stockbrokers marked up the share price of Guinness by 118kobo to close at N101.18 per share. Investors traded 50,823 shares worth N41.709million in 97 deals.

On the other hand, Flour Mills has raised investors’ hope for higher dividend as its nine months profit soared by 149 per cent from N817million in 2004 to N2.031billion in 2005.

Turnover for the same period had risen by only 29 per cent from N37.621billion to N48.538billion. Some stockbrokers said that they had expected such improved performance from the company given the fact that its raise fresh funds recently.

Besides, the company invested over N4billion in the rehabilitation, refurbishing, upgrading and replacement of old milling assets and facilities. It paid a dividend of 70kobo per share in 2005.

The results impacted positively on the equity price of Flour Mills as it rose by 82kobo to close at N26.92 per share.

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