Honeywell Flour Mills Plc recorded N109.5 billion in revenue for the 2021 financial year, the highest ever in the company's 23-year history. Despite the global economic impact of the COVID-19 pandemic, this represents a 36% increase from N80.4 billion recorded in 2020.
This revenue record places Honeywell Flour Mills in an elite company of FMCGs in Nigeria to have hit the N100 billion mark. The lockdown of the major cities across the country and the restriction of movement that impacted the livelihood of millions of Nigerians meant that FMCGs like Honeywell Flour Mills were responsible for keeping the economy moving while serving people with affordable staple food. The company's growth in the past year is evidence that it rose to the task.
Lanre Jaiyeola, Managing Director, Honeywell Flour Mills, Plc., said, "As an organisation, we have shown our commitment to serving our customers and catering to their needs through our range of products. None of this would be possible without the trust of our shareholders, the strength of our leadership, and the tenacity of our workforce. Our record growth in the last year proves just how committed we are to building a lasting legacy."
According to KPMG's analysis of the impact of COVID-19 on the Nigerian consumer and industrial markets, FMCGs are examples of low margin/high volume businesses from a retail perspective. To increase profitability as Honeywell has done, firms must drive customer loyalty and product differentiation, improve operational efficiency, and increase top-line sales.
Honeywell's understanding of the market also contributed to its improved profit after-tax figure, which is up 73% in 2021. A significant contributor to its revenue growth in the past year is the increased production capacity and higher operational efficiency at its factories in Apapa, Ikeja, and Sagamu. Its world-class pasta factory in Sagamu, Ogun State, which is only in its second year of operation, accelerated growth by increasing Pasta sales by 42%. This alone contributed over N19 billion to the company's overall revenue. Despite the pandemic, Honeywell Flour Mill Plc's factories also employed more people in the year ended March 31, 2021, than in the previous year.
Further improvements in operational efficiency and cost optimisation strategies also contributed to cutting down the company's selling and distribution expenses by 8%. In comparison, general and administrative expenses only grew by 4% despite double-digit inflation.
In the heat of a global pandemic, Honeywell partnered with both the CaCOVID initiative and a number of state governments by providing food items to their Emergency Food Response programmes and COVID-19 relief packages.
In addition to this, the company has continued to take measures that minimise the risk of contamination and ensure its products are manufactured with strict hygienic standards. Operations and staff facilities constantly go through deep cleaning, disinfection procedures, and fumigation exercises. Relevant staff receive personal hygiene and PPE items, practice social distancing, and are continually sensitised about the situation.
More impressive performances from large homegrown corporations, like Honeywell Flour Mills Plc, within the FMCG and manufacturing sectors will ultimately help increase investor confidence and participation in the Nigerian stock market.
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