UAC Nigeria slides to quarterly loss as feed, edibles drag on results

UAC of Nigeria Plc slipped into a quarterly loss in the final three months of 2025, weighed down by a sharp downturn in its Edibles and Feed business and higher financing and acquisition-related costs, even as revenue surged following the takeover of juice maker C.H.I. Ltd.

The Lagos-based conglomerate reported a loss before tax of ₦2.9 billion in the fourth quarter, compared with a profit of ₦10.6 billion a year earlier, according to unaudited results released Thursday. The company posted a net loss of ₦4.9 billion for the period.

The weakest performance came from Edibles and Feed, where revenue fell 39% to ₦21 billion and the unit swung to a ₦4.9 billion loss before tax, from a ₦1.9 billion profit a year earlier. The business was hit by falling agricultural commodity prices, which forced UAC to sell finished feed at lower prices while holding higher-cost inventory procured earlier in the year. An inventory write-down of ₦4.1 billion further eroded margins in the segment.

The quarterly loss overshadowed a sharp expansion in group revenue, which rose 62% to ₦183.8 billion, boosted by three months of contributions from C.H.I., acquired in October. For the full year, revenue jumped 74% to ₦343.4 billion, marking one of the strongest top-line performances in the company’s history.

Still, profitability was squeezed by rising costs. Net finance costs ballooned to ₦11.8 billion in the quarter from ₦1.9 billion a year earlier, reflecting higher borrowings and hedging expenses linked to the acquisition. Operating expenses climbed nearly 70% year on year, while gross margin contracted to 19.9% after inventory write-downs at the newly acquired unit.

Excluding one-off acquisition and hedge costs, UAC said underlying performance remained strong, with adjusted profit before tax of ₦16 billion for the quarter. For the full year, reported profit before tax fell to ₦7.5 billion from ₦25.5 billion, though underlying profit before tax rose 76% to ₦28.7 billion when exceptional costs were stripped out.

By segment, Packaged Food and Beverages — now anchored by C.H.I.’s Chivita and Hollandia brands — delivered the largest revenue contribution but still recorded a quarterly loss before tax due to acquisition-related expenses. Paints remained profitable, posting a 71% rise in quarterly profit before tax, while losses at Quick Service Restaurants narrowed.

Following the acquisition, UAC’s balance sheet became more leveraged, with long-term debt at 2.3 times EBITDA. Management said it is prioritising deleveraging, margin recovery and working capital optimisation in 2026.

“2025 was a pivotal year,” Group Managing Director Fola Aiyesimoju said, noting that the focus has now shifted from deal execution to value creation.

“The completion of the acquisition of C.H.I. Limited significantly increased the scale of our Group, with revenue reaching ₦343bn, a 74% increase compared to 2024. C.H.I. has expanded our portfolio into large, growth categories, including drinking yoghurt, evaporated milk, and juices anchored by the Chivita, Hollandia, and Capri-Sun brands, while the SuperBite and Beefie brands complement our existing presence in the snacks category.”