Another loss in Nigeria for FrieslandCampina

In the first quarter, Wamco realized a bottom line loss of 10,2 billion Nigerian Naira, which is equivalent to €6,3 million. In the same period last year, the loss in euros was even more than €20 million, but the pain is softened somewhat this year by the significant devaluation of the currency in the West African country. In Naira's the loss was about the same.

Turnover increased in the past quarter compared to a year earlier by just under 30% to €62 million, although this is probably mainly an effect of the high inflation in the country.  

Country in crisis
This largely explains the problems that the FrieslandCampina subsidiary is experiencing, because Nigeria is struggling with a persistent economic crisis accompanied by high inflation. In 2023, after a series of better years, the company also had to incur a loss of - based on the current exchange rate - approximately €14 million. In addition, a number of significant write-downs had to be made to the balance sheet last year.

High inflation means that sales volumes are under substantial pressure. CEO Jan Derck van Karnebeek pointed out in the 2023 annual report that Western consumers sometimes switch to cheaper private labels due to inflation, but that in countries such as Nigeria the question is whether people can still afford dairy at all. Since the beginning of this year, Wamco has appointed a new director who hopes to turn the tide, although the market conditions are challenging.  

Pakistan
Not only in Nigeria, but also the Pakistani subsidiary FrieslandCampina Engro Pakistan Limited performs disappointingly. Income fell sharply in the first quarter, although figures were not yet in the red.