Flour Mills of Nigeria Plc H1 2025 Result: Shifting Operational Conditions Prompts Delisting as PBT Regains Momentum

On the release of Flour Mills of Nigeria Plc’s (FMN) Q1 2025 results,

Proshare analysts had anticipated the company would embrace a strategic structural repositioning. Confirming this, FMN has announced a shift in its operational strategy, reflected in a share buyback proposal by its majority shareholder, Excelsior Shipping Company Limited (Excelsior). Excelsior intends to acquire all outstanding shares held by FMN’s minority shareholders.

Under this new direction, Excelsior, which currently holds approximately 63.34% of FMN’s shares, plans to further consolidate its control by acquiring the remaining minority stake, contingent on completing the necessary agreements. Under a Federal High Court order, holders of FMN’s fully paid-up ordinary shares will be called to a meeting to consider a Scheme of Arrangement (SoA), under which the shares may be transferred to Excelsior for N70.00 per share. This transaction, once completed, would result in FMN’s de-listing from the Nigerian Stock Exchange (see Table 1 below).

Table 1:

Flour Mills’ financial performance returned to a better outcome in H1 2025 from negative net earnings in H1 2024. Inflation remained higher, rising to 32% in September 2024, and the exchange rate stayed stable but weak at N1,541.94/$ as of September 30, 2024, over N755.27/$ in 2023. The challenging conditions manufacturers faced in 2024 were evident in the purchasing managers index (PMI), which hovered below the 50-point threshold at 49.7 Index points in September 2024. 

Key Highlights in H1 2025

Despite fiscal and monetary policy risks, FMN’s financial performance in H1 2025 saw improvement relative to the previous period. Analysts, however, note the need for increased focus on cost minimization efforts (see Table 1 below).

Table 1:

Segmental Performance

Analysts note that all segments saw a notable increase in contribution to total revenue, with each segment experiencing growth of at least +150% in H1 2025. This robust performance is attributed to enhanced sales and strategic price adjustments (see Table 2 below).

Table 2:

The robust sales performance was sufficient to offset the higher cost pressures from inflation and exchange rate depreciation. As a result, all segments contributed positively to pre-tax earnings in H1 2025, a marked improvement compared to H1 2024 (see Table 2 below).

Table 2:

Ratios

The Flourmill plc ratio reveals effective management of funds, conversion of assets, and funds into profits. The company’s inflow of liquidity increased in H1 2025. Flourmill remains on the lookout for investors as a high growth rate is expected (see Table 3 below).

Table 3:

Share Price Movement

The share price of FMN, which had remained mainly flat in H1 2025, surged following the disclosure of the consumer goods sector player, rising by +12.73% from N55.00 on September 24, 2024, to N62.00 on October 24, 2024. During the H1 2024 period, FMN’s share price increased and diverged from its H1 2024 average price line (see Chart 1 below).

Chart 1:

Competitor analysis

Nigerian consumer goods industry players revealed steady but better financial performance than in the previous period (see Table 4 below).

Table 4:

ADAPTED FROM THE PROSHARE