Analysis of Flour Mills of Nigeria
donne4real | April 23, 2008
Meristem Securities provided an analysis of the Flour Mills of Nigeria. The analysis /research is available at here.
Here are the main points:
FLOUR MILLS OF NIGERIA PLC: EQUITY RESEARCH REPORT
Executive Summary
-Flour Mills of Nig. Plc operates one of the most broad-based and diversified portfolio of industrial products in Nigeria having successfully weathered the storms of the conglomerates’ power play and struggle for relevance in a stiffly competitive market place.
-Owing to aggressive expansion in product lines, the company recorded impressive organic growth in its FYE 2007 result. The group’s Operating Profit and Profit After Tax (PAT) grew by 56.25 percent and 59.57 percent respectively. However, the company’s recent Q-3 2007 results show modest declines of 6.5 percent and 6.7 percent in PBT and PAT respectively.
-Our forecasts for FYE 2008 put turnover at 120.8billion, PBT and PAT at N11.04 billion and N7.80 billion respectively translating to an EPS of N5.04k. We expect modest improvement in performance in some of Flour Mills’ major subsidiaries especially Nigerian Bag Manufacturing Company (BAGCO) which is a foremost bag manufacturing company in Nigeria and the Northern Nigeria Flower Mills (NNFM) which has recently bounced back into profitability after several years of cumulative losses.
