UAC of Nigeria PLC (UACN), one of Nigeria’s oldest and most diversified conglomerates with interests in packaged foods, paints, logistics, and animal feeds, has reported a profit after tax of ₦5.38 billion for the nine months ended September 30, 2025. This represents a sharp decline of 60.6 percent from the ₦13.67 billion recorded in the same period of 2024, as rising finance costs, acquisition-related expenses, and inflationary pressures weighed heavily on the group’s profitability.
Revenue Growth Supported by Price Adjustments
The group delivered revenue of ₦159.58 billion during the nine-month period, representing a 19.8 percent increase compared to ₦133.18 billion in the corresponding period of 2024. The growth was driven primarily by price adjustments across major business units and modest volume recovery in the Food and Beverage and Paints segments.
Cost of sales, however, increased by 17.3 percent to ₦120.21 billion from ₦102.44 billion, reflecting continued inflationary pressures, high input costs, and the impact of exchange rate volatility. Gross profit therefore rose to ₦39.37 billion, up 28 percent from ₦30.74 billion in 2024, showing some improvement in production efficiency.
Operating Expenses and Finance Costs Pressure Earnings
Selling and distribution expenses rose to ₦10.49 billion from ₦7.75 billion, while administrative expenses jumped to ₦17.49 billion from ₦12.11 billion, reflecting inflation, higher transport costs, and wage adjustments to retain skilled employees in a challenging operating environment.
Operating profit grew slightly to ₦13.42 billion from ₦12.30 billion, but finance-related items eroded much of the gain. Finance income fell sharply to ₦2.94 billion from ₦12.27 billion, while finance costs more than doubled to ₦8.68 billion from ₦4.42 billion, driven by higher borrowing rates and reduced interest income on investments. Consequently, UACN recorded a net finance cost of ₦5.74 billion compared to a net finance income of ₦7.85 billion in the previous year.
Impact of CHI Acquisition Costs and FX Losses
A significant factor in the group’s weaker performance was the cost impact from its acquisition of CHI Limited, which management confirmed increased one-off expenses during the period. These costs, combined with foreign exchange losses following the continued depreciation of the naira, contributed materially to the decline in quarterly profitability.
On a like-for-like basis, adjusting for these one-off acquisition-related costs and FX impacts, UACN’s underlying profit before tax stood at ₦12.2 billion, higher than the ₦10.6 billion recorded in 2024, demonstrating that core operations remain fundamentally strong.
Sharp Decline in Quarterly Performance
For the third quarter of 2025, UACN reported a pre-tax loss of ₦703 million, compared to a ₦5.9 billion profit in the third quarter of 2024 and a ₦6.1 billion profit in the second quarter of 2025. The company attributed this loss primarily to acquisition-related costs from the CHI transaction, coupled with rising input costs, high energy prices, and adverse foreign exchange movements.
As a result, profit before tax for the nine months stood at ₦10.40 billion, down from ₦20.83 billion in 2024, representing a 50 percent decline. After accounting for ₦5.01 billion in tax expenses, profit after tax settled at ₦5.38 billion. Earnings per share dropped to 179 kobo, down from 426 kobo recorded in 2024.
Balance Sheet and Financial Position
UACN’s total assets stood at ₦148.91 billion as of September 30, 2025, compared to ₦157.73 billion as of December 2024. Cash and cash equivalents fell to ₦28.43 billion from ₦40.59 billion due to higher working capital requirements and acquisition-related disbursements.
Borrowings amounted to ₦39.01 billion, slightly lower than ₦41.48 billion at year-end 2024, though a larger proportion of the debt now comprises short-term obligations. Shareholders’ equity was ₦62.46 billion, marginally lower than ₦62.74 billion recorded in December 2024.
Segment Performance and Key Drivers
The Packaged Foods and Beverages division delivered strong revenue growth but lower margins due to increased raw material costs and foreign exchange-related expenses on imported inputs. The Animal Feeds and Other Edibles segment continued to face volatility in maize and soybean prices, though partial local sourcing helped cushion the impact.
The Paints business, through associate company Chemical and Allied Products (CAP) PLC, contributed ₦2.72 billion in profit from associates, representing a significant 294 percent increase from ₦690 million in 2024. This contribution was a key positive driver for the group’s earnings.
Meanwhile, the Logistics and Real Estate segments faced sustained cost pressures from fuel, fleet maintenance, and sluggish property turnover.
Liquidity and Investment Activities
UACN’s investment in associates increased to ₦13.17 billion from ₦10.15 billion, signaling confidence in the performance of its core subsidiaries. A notable ₦19.17 billion deposit for investment under current assets reflects the company’s active investment pipeline, though details remain undisclosed.
Despite reduced liquidity, the group maintained strong asset backing and moderate gearing. Management is expected to focus on improving working capital efficiency and extending debt maturities to reduce exposure to short-term financing risks.
Outlook and Strategic Focus
Looking ahead, UACN plans to streamline post-acquisition integration costs from CHI Limited, optimize its cost structure, and strengthen its cash flow generation in the fourth quarter of 2025. The company is also expected to prioritize debt restructuring, margin recovery in key segments, and product innovation in its consumer goods lines.
While inflation and FX volatility remain significant headwinds, management maintains that underlying performance remains solid, with positive momentum expected once one-off acquisition and financing costs normalize.
Analyst Commentary
Analysts noted that UACN’s Q3 loss underscores the short-term strain from its CHI acquisition but emphasized that the deal is strategically positive for long-term growth and diversification. The company’s ability to sustain revenue growth despite macroeconomic challenges reflects strong brand equity and market presence, but investors will watch closely for margin recovery and improved financing efficiency in subsequent quarters.
Summary Table (₦’000)
| Metric | 9M 2025 | 9M 2024 | YoY Change |
|---|---|---|---|
| Revenue | 159,578,048 | 133,182,667 | +19.8% |
| Gross Profit | 39,371,970 | 30,739,423 | +28.1% |
| Operating Profit | 13,417,065 | 12,295,307 | +9.1% |
| Profit Before Tax | 10,397,209 | 20,833,258 | -50.1% |
| Underlying Profit Before Tax | 12,200,000 | 10,600,000 | +15.1% |
| Profit After Tax | 5,382,548 | 13,667,340 | -60.6% |
| Basic EPS (Kobo) | 179 | 426 | -57.9% |
