BUA Foods Plc, led by Managing Director Engr. Ayodele Abioye, increased its profit after tax by 11.2 per cent to ₦450.47bn for the nine months ended September 30, 2026, despite a 19.3 per cent decline in revenue, as lower production costs and tighter operating expenses strengthened margins.

The unaudited results, filed with the Nigerian Exchange and reported in Lagos on November 3, showed that gross profit rose to ₦552.90bn from ₦520.65bn in the corresponding period of 2025.

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The performance reflects a significant improvement in the food manufacturer’s cost structure, although the fall in turnover points to continuing pressure on sales.

Revenue declined to ₦1.15tn from ₦1.42tn a year earlier, a reduction of approximately ₦274.90bn.

Despite the weaker topline, cost of sales fell by 34.1 per cent to ₦592.94bn from ₦900.09bn.

The reduction outpaced the decline in revenue, allowing gross profit to increase by 6.2 per cent and gross profit margin to widen to 48.3 per cent from 36.7 per cent.

BUA Foods attributed the revenue contraction to softer pricing conditions and subdued consumer demand.

The company said improved productivity, cost optimisation and a more stable foreign exchange environment helped protect profitability during the period.

The figures also show that raw material costs, the largest component of production expenses, dropped to ₦523.39bn from ₦833.84bn.

Energy costs declined more modestly to ₦41.48bn from ₦46.45bn, according to the financial statements.

Operating expenses also came down, falling 20 per cent to ₦66.99bn from ₦83.65bn.

Selling and distribution expenses decreased by 15.4 per cent to ₦45.04bn, while administrative expenses dropped by 27.9 per cent to ₦21.95bn.

These reductions helped lift operating profit to ₦492.50bn from ₦437.58bn, representing an increase of about 12.5 per cent.

Operating profit margin expanded to approximately 43 per cent from 31 per cent.

Profit before tax rose 11.1 per cent to ₦480.52bn, compared with ₦432.58bn in the previous year, while earnings per share increased to ₦25.03 from ₦22.52.

However, the results also reveal a higher finance-cost burden.

Net finance costs increased to ₦11.98bn from ₦4.86bn, as finance income fell sharply to ₦985.68m from ₦7.05bn. The increase partly offset gains achieved through lower production and operating expenses.

Performance across the company’s product lines was mixed.

Sugar remained its largest revenue contributor, generating approximately ₦495.1bn, although sales declined by about 17 per cent.

Bakery flour revenue fell by approximately 30 per cent to ₦387.64bn, while rice sales dropped by more than half to ₦37.40bn.

Pasta provided a brighter spot, with revenue increasing by 31.6 per cent to ₦198.11bn from ₦150.49bn.

The growth offered some support against weaker sales in other product categories, highlighting differences in demand and pricing across the company’s portfolio.

Commenting on the results, Abioye said the performance demonstrated the resilience of the company’s operating model and the benefits of disciplined cost and margin management.

“Our nine-month 2026 results demonstrate the resilience of BUA Foods’ operating model and the benefits of disciplined cost and margin management. Despite a 19% decline in revenue to N1.15 trillion, driven by softer pricing conditions and subdued consumer demand, we maintained a substantial improvement in profitability through effective cost optimisation, improved productivity and rigorous execution across the business,” he said.

He added that the strength of the company’s brands and continued investment in route-to-market capabilities would support its growth ambitions.

“Looking ahead, we remain focused on driving profitable growth, enhancing market penetration and maintaining operational efficiency,” Abioye said.

The latest performance follows a similar pattern in the first half of 2026. BUA Foods reported revenue of ₦765.12bn for the six months ended June 30, down from ₦912.51bn in the corresponding period of 2025, while profit after tax increased by 12 per cent to ₦292.27bn. Gross profit margin had already expanded to 47.5 per cent from 37.2 per cent.

The company has also outlined an expansion strategy involving increased wheat milling capacity, completion of its edible oils business, the introduction of noodles and further investment in integrated manufacturing operations.

These plans are intended to broaden its product range and strengthen domestic food production.

For investors, the nine-month results present two contrasting signals: stronger earnings and improved margins on one hand, and a substantial contraction in revenue on the other.

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The sustainability of the profit growth will depend partly on whether BUA Foods can maintain its lower cost base while restoring sales volumes and demand across its major product categories.