Mr. Atedo Peterside, Chairman. Cadbury Nigeria

By ADEBAYO OBAJEMU

Cadbury Nigeria Plc has announced a dividend of N471million for its shareholders, in line with its current efforts to create more value for investors. By this action, the Company has increased its dividend payment from 16 kobo in 2017, to 25 kobo in 2018.

Speaking at the company’s 54th annual general meeting in Lagos over the weekend, Mr. Atedo Peterside, Chairman, Cadbury Nigeria,  attributed the Company’s positive growth in the year under review to success of its cost-cutting measures, effective marketing strategy, and superlative performance of its various brands, he assured that Cadbury Nigeria will continue to sustain its dividend policy.

He added: “We re-launched our iconic cocoa beverage drink, Bournvita, with a new improved taste, last year, in line with consumers’ tastes and preferences. Feedback from consumers indicate that the new Bournvita has gained wide acceptance.

“Cadbury Hot Chocolate 3-in-1 brand, our treat portfolio, recorded substantial growth, driven by its unique offering, while our gum and candy brands also recorded success in their respective categories. In addition, we sustained our current price competitiveness, and increased our Route-to-Market coverage/footprint in 2018.”

In spite of harsh operating environment and downturn in the economy, with overall gloomy prospects of the country’s macroeconomic, Cadbury Nigeria Plc had some weeks ago announced revenue of N9.283 billion for the three months ended March 31, 2019. This figure is an increase of 12.7 percent over N8.235billion revenue realised within the same period in 2018.

The first quarter report of the beverage maker also posted a gross profit of N2.375 billion, representing an increase of 32 percent over the N1.799billion, which was reported for the same period in 2018. Cadbury Nigeria’s profit for the period stood at N506 million, which in real term amounts to 2,200 percent growth, when compared to N22million realised in the first quarter of last year.

Just last week, a global credit rating agency, Moody’s Investors Service, said Nigeria is trapped in a low growth path for the time being. The Vice President – Senior Credit Officer, Sovereign, Aurelien Mali, said on Wednesday that government revenue weakness remained a key credit challenge, adding that the country’s balance sheet had “deteriorated to a level that is worrisome.”

Moody’s noted that the country’s real GDP growth remained subdued at 1.9 per cent in 2018 following 0.8 per cent in 2017, saying, “This growth level remains insufficient to markedly improve Nigerian living standards

Yet, in the face of this grim analysis, Cadbury Nigeria’s first quarter result shows strong fundamentals and in a way reflects a sustained positive trajectory in the company’s performance. The 2018 full year result showed profit before tax increase by 242.9 percent to N1.2billion, from N350 million in 2017. The company also posted an increase of 174 percent in its profit after tax from N299.9million to N823million, within the same period under review.

Mr. Ambrose Omokordion, chief research officer at Investa told BusinessHallmark that ” though the company has had its fair share of ups and down, especially the low point of book cooking scandal during Bunmi Oni’s era, it has strong fundamentals to project positive growth in spite of harsh economic weather and stiff competition, and with a new managing director and right vision,  the company has bright prospects. ”

Omokordion’s view resonates with Dr. Olufemi Omoyele, a management consultant and brand expert who teaches Management at Redeemer University. In his chat with this newspaper, he said “the competition and struggle for market share in the Beverages sub sector is keen, and Cadbury’s first quarter result looks good, it will have to rebrand significantly and be on top of its game in order to sustain positive outlook for growth. And with the new management, it is a possible goal. ”

Recall that early in the year, Cadbury Nigeria had made significant changes to its management structure, and for the first time in its over five decades’ operation in the country, a woman emerged the managing director of the company. This affirmative action rebranding holds a glimmer of prospects for the company in the face of stiff competition in the Nigeria’s beverage industry.

Mrs. Oyeyimika Adeboye resumed as managing director, effective 1st April, 2019.

She took over the mantle of leadership from Amir Shamsi, who  has since moved on to a new role within Mondelēz International, the parent company of Cadbury Nigeria.

Cadbury Nigeria Plc (CN), a publicly quoted company, is the pioneer cocoa beverage manufacturer offering some of the most popular brands in the country. Cadbury Nigeria is a 74.99 percent-owned subsidiary of Mondelēz International, a global snacking powerhouse with an unrivalled portfolio of brands. The remaining 25.01 percent of shares are held by a diverse group of indigenous, individual and institutional investors.

Beginning

The origins of Cadbury Nigeria Plc. date back to the 1950s when the business was founded as an operation to source cocoa beans from Nigeria and as a precursor to enable the company’s founders to tap opportunities for serving the local consumer-market with world-famous, Cadbury-branded products.

In the early 1960s, an initial operation was established to re-pack imported bulk products. This packing operation grew rapidly into a fully-fledged manufacturing operation and resulted in the incorporation of Cadbury Nigeria Limited in January 1965.

In 1976, the firm became a publicly listed company with shares traded locally on the Nigerian Stock Exchange. Cadbury Nigeria has grown to become a household name providing consumers with much-loved brands and revenue of N35.7b in 2013.

Portfolio of Brands

Introduced in 1960, Cadbury Bournvita, the company’s flagship brand, was initially imported and re-packed locally on the current site at Agidingbi, Ikeja Lagos. Having consolidated the Food Drinks market in Nigeria, Cadbury Bournvita became in 1965 the first Food Drink to be locally manufactured.

Cadbury Bournvita was re-launched in a World Class, Environmentally Friendly Polypropylene Jar in 2011 and once a market leader it today struggles to keep pace with the competition in the Food Drinks category. In 2013, the Nutrition Society of Nigeria (NSN) endorsed Cadbury Bournvita as a Food Drink rich in energy and essential micronutrients, the only Food Drink Brand to be so endorsed.

Other Brands in the Portfolio

Cadbury Nigeria also developed other product-categories, most notably Candy. Introduced in 1970, Tom-Tom – the big, black and white sweet for soothing relief which has sustained market leadership for over 40 years – remains the most iconic brand in the Nigerian Candy market. It now comes in three variants: Classic, Honey Lemon and Strawberry.

The other brand in the company’s Candy portfolio is Trebor Buttermint, the delicious sweet with the double pleasure of butter and mint. In 2012, the company expanded its product categories in Nigeria when it launched Tang, the global leader in powdered beverages.

Subsidiary Business

Cadbury Nigeria owned 99.66% equity in Stanmark Cocoa Processing Company Limited, located in Ondo Town in Ondo State, Nigeria. The Company provides all the cocoa powder required for manufacturing Cadbury Bournvita. Stanmark Cocoa Processing Company Limited processed cocoa beans into several high quality cocoa by-products (such as cocoa butter, cocoa powder, cocoa cake and cocoa liquor) for local and export markets.

In April 2013, Cadbury Nigeria acquired the majority equity-interests in the company, becoming part of the enlarged Cadbury Nigeria family and now known as Cadbury Nigeria Plc Cocoa Processing Plant.

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