BUA Foods Plc has demonstrated remarkable resilience and adaptability in the face of a challenging business environment, posting impressive growth in its 9-month results for 2025. The company’s strategic initiatives and operational excellence have enabled it to maintain a steady growth profile, even as the industry grapples with infrastructural obstacles and rising costs.
Working Capital Management Metrics
| Metric | Value |
|---|---|
| Receivable Days | 7.85 days |
| Inventory Days | 31.11 days |
| Payable Days | 57.41 days |
| Cash Conversion Cycle (CCC) | -18.45 days |
| Current Ratio | 1.42 |
BUA Foods’ revenue grew by 33% to ₦1.42 trillion in 9M 2025, driven by increases in all reporting segments. The Sugar division contributed 42% to revenue, growing 10% to ₦599.2 billion, while the Flour division grew 52% to ₦591.5 billion, driven by increased volume and improved product mix. The Pasta division grew 12% to ₦150.5 billion, driven by increased market demand, and the Rice division grew 4884% to ₦79.5 billion.
The company’s revenue growth can be attributed to its strong brand portfolio, diversified product offerings, and effective marketing strategies. BUA Foods has continued to invest in its brands, launching new products and expanding its distribution network to reach more customers.
Despite the rising cost of sales, which increased by 22% to ₦900.09 billion, BUA Foods was able to contain costs and improve its gross profit margin by 570bps to 36.7%. The company’s operating profit grew by 39% to ₦437.58 billion, driven by strategic pricing policies and operational excellence.
BUA Foods’ profitability is underpinned by its efficient cost management and optimization of resources. The company has implemented various cost-saving initiatives, including energy efficiency measures and supply chain optimization, which have contributed to its improved profitability.
BUA Foods’ working capital management is a key driver of its success. The company’s receivable days, a measure of how quickly it collects its receivables, is approximately 7.85 days, demonstrating efficient receivables management. This is significantly lower than the industry average, indicating that BUA Foods has a strong credit management policy in place.
The company’s inventory days, a measure of how quickly it sells its inventory, is approximately 31.11 days, demonstrating efficient inventory management. BUA Foods has implemented various inventory management strategies, including just-in-time inventory management and inventory optimization, which have contributed to its improved inventory turnover.
The company’s payable days, a measure of how quickly it pays its suppliers, is approximately 57.41 days, demonstrating favorable payment terms. BUA Foods has negotiated favorable payment terms with its suppliers, which has helped to improve its cash flow and reduce its working capital requirements.
BUA Foods’ Cash Conversion Cycle (CCC) is negative, indicating that it collects cash from customers before paying suppliers, demonstrating efficient working capital management. The company’s CCC is a key indicator of its ability to manage its working capital and generate cash flows.
BUA Foods’ liquidity position is healthy, with a current ratio of 1.42. The company’s debt management is also effective, with a reduction in finance costs indicating a decrease in debt burden.
BUA Foods has a strong balance sheet, with a debt-to-equity ratio of 0.93, indicating that it has a manageable level of debt. The company’s interest coverage ratio is 36.5, indicating that it has sufficient earnings to cover its interest payments.
BUA Foods’ effective working capital management has several implications for stakeholders. The company’s strong working capital management is likely to drive long-term growth and profitability, making it an attractive investment opportunity. BUA Foods’ ability to negotiate favorable payment terms with suppliers is likely to lead to stronger relationships and more favorable credit terms.
The company’s efficient inventory management and strong cash flow generation enable it to maintain a stable supply chain, ensuring timely delivery of products to customers. BUA Foods’ success is likely to lead to increased job security and opportunities for growth and development.
In conclusion, BUA Foods’ working capital management is a key driver of its success, enabling the company to maintain a healthy liquidity position, reduce debt, and drive growth. The company’s strong performance is likely to have positive implications for its stakeholders.
Key financial highlights include revenue of ₦1.42 trillion, gross profit of ₦520.65 billion, operating profit of ₦437.58 billion, and net profit after tax of ₦405.27 billion. The company’s working capital management metrics include receivable days of 7.85 days, inventory days of 31.11 days, payable days of 57.41 days, and a cash conversion cycle of -18.45 days.
