April 2, 2024/CSL Research

In its 2023 audited earnings result, Cadbury Nigeria Plc. (Cadbury) reported a 45.6% y/y growth in Revenue to N80.4bn from N55.2bn in 2022. Its cost of sales (adjusted for depreciation) grew slower than Revenue, up 33.2% y/y to N61.0bn from N46.5bn bringing its Gross Profit to N18.5bn in 2023 from N8.8bn in 2022. Consequently, its Gross Profit margin increased 7.1ppts to 23.0% from 15.9%. On a q/q basis, the company’s Revenue was down 10.2% to N21.2bn in Q4 2023 from N23.6bn in Q3 2023.

The company’s Operating Expense (adjusted for depreciation) increased by 25.7% y/y to N9.0bn from N7.2bn in 2022. The Selling and Distribution Expense (adjusted for depreciation) also grew by 15.7% y/y to N7.2bn in 2023 from N6.2bn in the prior year. On the same note, the Administrative Expenses (adjusted for depreciation) increased 89.4% y/y to N1.8bn in 2023 from N971m in 2022. However, the company reported writebacks for receivables of N3.5m in 2023 from N4.2m in 2022.

​

Furthermore, the company reported EBITDA of N9.5bn in 2023 from N1.6bn in 2022. Depreciation and amortization came in at N1.7bn in 2023 from N1.5bn in 2022 bringing its Operating Profit to N7.8bn in the period from N113m in 2022. The inclusion of Other Income of N73m (vs N82m in 2022) brought its EBIT to N7.9bn in 2023 from N194m in 2022.

Cadbury reported Finance Income of N2.3bn in 2023 from N1.6bn in 2022 while its Finance Cost grew significantly to N38.3bn in 2023 from N504m in 2022. The rise in Cadbury’s Finance Cost comes on the back of foreign exchange losses (Unrealised of N6.86bn and realised of N30.07bn) amid the depreciation of the Naira. Consequently, its Net Finance Expense settled at N36.03bn in 2023 from a gain of N1.1bn in 2022. The exponential rise in its Finance Expense resulted in a Loss Before Tax of N28.2bn in 2023 from a Profit Before Tax of N1.3bn in 2022. A tax credit of N9.07bn in 2023 brought the Net Loss to N19.1bn in the period compared with a profit of N583m in 2022.

We currently have Cadbury under review. Current price of N19.00/s.

Kindly click on the below link to download the full report.

​​​​​CSL_Cadbury_Quick Take FY 2023.pdf​​​