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By NBF News
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In spite of the harsh operating enviHoneywell Flour Mills Plc., Nigeria's  one of the premier producers of wheat based products listed on the floor of the Nigerian Stock Market has posted a 12 per cent growth in turnover during the financial year ended March 31, 2012.

The audited annual financial results for the year ended released to the Nigerian Stock Exchange (NSE) showed turnover, represented by revenue from sales of products grew by 12 per cent from N34 billion in the 2011 financial year to N38 billion in 2012.

The growth in turnover according to the management of the company was constrained by current milling capacity of 1,610MT/day which is fully utilised at the moment as the company operates a very efficient flour milling operation with an average capacity utilisation of over 90 per cent, well above the industry average of 50 per cent.

The dynamics of wheat fundamentals, typified by fluctuating world wheat supply situation, presented cost challenges as input-cost inflation was prevalent during the financial year; and this severely encumbered bottom-line earnings growth.

The management noted that the Company responded to rising operational costs by achieving moderate increases in prices of some of its products in order to improve declining product margins.

Profit after tax grew by eight per cent, year-on-year, from N2.49 billion in 2011 to N2.7 billion in 2012.

In terms of assets, the company achieved high double digit growth rates as total assets grew by 54 per cent to N45 billion via the acquisition of several strategic assets including a state-of-the-art fully automated warehousing and inventory control system.

In the year reported, the company forged relationships with its distributors and strategic partners through several business-to-business engagement forums and initiatives aimed at improving its distribution network ahead of planned capacity increase.

The Managing Director of the company Mr. Babatunde Odunayo said Honeywell anticipates more impressive results and appreciable growth in the 2013 financial year when additional capacity from its 1,000MT/day twin mill facility, which is close to completion, would come on stream. This capacity increase of 62 per cent would take total milling capacity to 2,610MT/day and will be reflected in increased sales and profit.

Odunayo noted that to support its longer term aspirations, the Company is looking to expand its growth platforms via the introduction of new brands, in the near term, that will participate in fast growing food segments to meet the needs of consumers.