BUA Foods targets 50% capacity boost, plans job creation drive

BUA Foods Plc has announced plans to expand its production capacity by more than 50 percent in 2026, as it seeks to strengthen its foothold in Nigeria’s fast-moving consumer goods market, valued at about N23 trillion, while creating hundreds of jobs.

Speaking during an investor call, Managing Director Ayodele Abioye said the company is intensifying its expansion efforts across key business segments to meet rising demand and drive innovation.

According to him, the planned expansion will enhance production capabilities, deepen market penetration, and support growth and profitability over the short to medium term.

“We are committed to delivering over 50 percent capacity growth across our divisions, which will position us to better serve consumers and introduce new products,” Abioye noted.

The company expects double-digit growth in production volumes, supported by steady demand and a gradual recovery in consumer spending across its product categories.

BUA Foods also identified improving macroeconomic conditions—including easing inflation, relative stability of the naira, expansion of the FMCG sector, and new tax policies—as key drivers of future growth. However, it remains cautious about risks such as volatile energy costs, weak consumer purchasing power, and foreign exchange exposure.

As part of its long-term strategy, the firm is pushing forward with its backward integration programme in sugarcane development, aimed at strengthening supply security and improving cost efficiency, especially amid global supply chain disruptions linked to tensions in the Middle East.

Abioye noted that while the company has not experienced any significant impact on earnings from the ongoing regional conflict, it continues to closely monitor developments and engage with supply partners.

To navigate global uncertainties, BUA Foods said it is focusing on efficiency improvements, sourcing optimisation, cost management, and brand protection to cushion potential shocks from logistics, energy, and currency fluctuations.

The company delivered a strong financial performance in 2025, with net profit more than doubling to N518.38 billion, according to its audited results. Revenue grew by 16 percent to N1.77 trillion, driven by increased sales of staple products such as sugar, flour, pasta, and rice, which remained in high demand despite pressure on household incomes.

The strong earnings performance of the Lagos-based company, majority-owned by Abdul Samad Rabiu, has supported a proposed dividend payout of N28 per share, totaling about N504 billion—a 115 percent increase from the previous year.

Looking ahead, the company expects improving economic conditions, including lower inflation and more stable interest rates, to boost consumer demand and enhance profit margins.

“We see significant opportunities to grow volumes and expand our market reach by leveraging our brands, operational expertise, and distribution network,” Abioye added.