Q2 2026 UAC of Nigeria PLC Earnings Call Transcript
Key Points
- Revenue increased 231% to ₦365 billion in H1 2026, driven by strong growth in Food and Beverages and Paints, as well as the C.H.I. acquisition.
- Operating profit surged 289% to ₦49 billion, with operating margin expanding 201 basis points to 13.4%.
- Profit before tax tripled to ₦34 billion, and earnings per share rose to 658 kobo from 238 kobo year-over-year.
- Free cash flow generation was robust at ₦71 billion, more than 8 times the prior year, supported by a ₦30 billion reduction in inventory.
- C.H.I. integration is ahead of plan, with margins improved from 2% to 15% in the half year, and net debt to EBITDA improved to 1.6 times.
- Volume growth was recorded across all major segments, including UAC Foods and Paints, with the retail footprint expanded by 42 new touchpoints at CAP.
- Q2 2026 saw a sequential decline in revenue and profit due to macro headwinds, including the Middle East conflict, higher energy costs, and supply chain disruptions.
- Net finance costs increased significantly to ₦16 billion from ₦3.6 billion, reflecting interest on borrowings from the C.H.I. acquisition, which compressed the PBT margin by 62 basis points.
- The Edibles and Feed segment experienced a ₦15 billion revenue decline due to lower finished goods prices and sales volumes.
- Return on invested capital fell to 25% from 40% a year ago, reflecting the larger capital base post-acquisition.
- The QSR business remains a drag, with losses halved but still far from target, and a decision on its future is not expected in the near term.
- Consumer purchasing power weakened in Q2 due to a sharp rise in petrol prices, impacting demand and contributing to softness in the Paints business.
Good morning and good afternoon ladies and gentlemen. Welcome to UAC of Nigeria PLC Half Year 2026 Results Conference Call. Please note that this call is being recorded. This conference call will be hosted by Fola Aiyesimoju, the Group Managing Director of UAC of Nigeria PLC, and Funke Ijaiya-Oladipo, the Group Finance Director. (Operator Instructions)
I will now hand the call over to Fola Aiyesimoju. Please go ahead.
Thank you, Cynthia. Good day all. Funke and I will cover today the operating environment in the first half of the year, we will touch on our strategic priorities, discuss financial performance, and present our outlook for the business. We will reference the numbers on the top right of the presentation such that you can follow along.
Please turn to slide 5.
We delivered good performance in the first half of the year. Compared with H1 2025, revenues increased 231% to â¦365 billion. Operating profit increased 289% to â¦49 billion, and profit before tax
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