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Yet another loss in Nigeria for FrieslandCampina
After a better second quarter, Nigerian Wamco, a subsidiary of FrieslandCampina, has yet again had to present red figures. The poor economic situation in the African country continues to undermine margins.
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The Nigerian subsidiary (in which FrieslandCampina has a 68% stake) has been in difficult waters for some time, but the second quarter figures were promptly better and also profitable. However, the upward trend did not continue in the past quarter. Below the line, Wamco recorded a loss of approximately 252 million Nigerian naira. Converted to current exchange rates, this amounts to a limited loss of €150.000. Turnover rose last quarter to the equivalent of approximately €68 million.
Recovery plan
Over the first three quarters, the result is converted to more than €1,1 million negative. However, a better trend can be discovered, because in the same period a year earlier, the loss in the Nigerian currency was four times as much. The management therefore says that it believes in structural profitability, after a recovery plan was recently put into effect.
Sales volumes
For example, sales volumes are showing an upward trend, which is encouraging for the future. Wamco nevertheless speaks of challenging market conditions, as Nigeria is struggling with sky-high inflationary pressure. In addition, the Nigerian naira has weakened considerably against the euro and other Western currencies, something that has actually been going on for years.
In Pakistan, where FrieslandCampina is also active with a subsidiary, the results are positive. Engro Foods Pakistan booked a turnover of €267 million and a profit of more than €6,5 million in the first nine months of this year.