UAC of Nigeria Plc, a diversified conglomerate with interests spanning packaged food and beverages, animal feeds, paints, and quick service restaurants, has announced robust financial results for the first half of 2025, demonstrating resilience and growth despite challenging macroeconomic conditions. The company’s half-year revenue surged by 33% to N110.4 billion, propelled by strong consumer demand and consistent growth across its core business segments. This impressive top-line performance underscores the effectiveness of UAC’s strategic focus on meeting evolving consumer needs and capitalizing on market opportunities.
The company’s enhanced profitability is further highlighted by a 51% increase in gross profit, reaching a significant milestone in its financial performance. This growth was driven by a combination of strategic pricing initiatives and rigorous cost management, resulting in a substantial 300 basis points expansion in gross margins. This improvement reflects UAC’s operational efficiency and ability to navigate the complexities of a recovering macroeconomic environment, optimizing its operations for maximum profitability.
While UAC reported a 23% decline in profit after tax, this decrease requires contextualization. The decline is primarily attributed to the absence of a one-off foreign exchange gain of N9.4 billion recorded in the corresponding period of the previous year. This non-recurring gain significantly inflated the prior year’s profit, making a direct year-on-year comparison misleading. Excluding this exceptional item provides a clearer picture of UAC’s underlying performance, revealing a substantial 91% surge in profit before tax. This adjusted figure reflects the true strength of the company’s operational performance and its ability to generate sustainable profits.
Analyzing the performance of individual business segments reveals a nuanced picture of growth and adaptation. The packaged food and beverages segment emerged as the star performer, registering a remarkable 43% increase in revenue. This growth reflects the segment’s ability to capitalize on increasing consumer demand and its successful product portfolio management. The animal feeds segment also contributed significantly to the overall positive performance, achieving a 24% revenue growth, driven by the increasing demand for livestock products in the region. The paints segment also exhibited robust growth, expanding by 29%, fueled by strategic expansion initiatives including the addition of 51 new retail points nationwide. These additions expanded the company’s reach and market penetration, contributing significantly to the segment’s revenue growth.
In contrast to the positive trajectory of other segments, the Quick Service Restaurants (QSR) segment experienced a decline in revenue. This downturn is attributed to a combination of factors, including the strategic rationalization of underperforming outlets. By streamlining its QSR operations, UAC aims to improve overall profitability and focus on its more successful locations. Additionally, inflationary pressures impacting consumer spending have played a role in the segment’s performance. The rising cost of living has likely affected consumer discretionary spending, impacting the demand for restaurant services.
Looking ahead, UAC’s Group Managing Director, Fola Aiyesimoju, expressed optimism about the company’s future prospects. He emphasized the company’s commitment to disciplined execution of its strategic plans and its focus on creating long-term value for shareholders. This commitment suggests a continued emphasis on operational efficiency, strategic investments, and a customer-centric approach. The strong performance in the first half of 2025, despite the challenges in the QSR segment and the impact of the one-off foreign exchange gain in the prior year, positions UAC for continued growth and reinforces its position as a leading player in the Nigerian market. The company’s diversified portfolio, combined with its proactive approach to adapting to market dynamics, provides a strong foundation for future success. As UAC continues to navigate the evolving economic landscape, its commitment to sustainable growth and shareholder value creation remains paramount.
