Loss in Nigeria for FrieslandCampina again

After a better second quarter, the Nigerian WAMCO, a subsidiary of FrieslandCampina, had to present red figures again. The poor economic situation in the African country continues to hamper margins.

The Nigerian subsidiary (in which FrieslandCampina has a stake of over a quarter) has been in difficult waters for some time, but the second quarter figures were promptly better and also profitable. However, the upward trend did not continue in the past quarter. Wamco posted a loss of about 252 million Nigerian Naira. Converted at the current exchange rates, this amounts to a limited loss of €150,000. Revenue increased to approximately €68 million in the last quarter.

Recovery plan
Over the first three quarters, the result is negative by over €1.1 million. Nevertheless, a better trend can be observed, as in the same period a year earlier, the loss in Nigerian Naira was four times higher. The management therefore believes in structural profitability after a recovery plan was recently put into effect.

Sales volumes
For example, sales volumes show an upward trend, which is hopeful for the future. Nevertheless, Wamco speaks of challenging market conditions, as Nigeria is facing high inflationary pressure. In addition, the Nigerian Naira has significantly weakened against the euro and other Western currencies, a trend that has been ongoing for years.

In Pakistan, where FrieslandCampina also operates through a subsidiary, the results are positive.

Wouter Baan

Wouter Baan is the editor-in-chief of Farmerbusiness and a market specialist in dairy, pork, and meat at DCA Market Intelligence. He also tracks developments within the agribusiness sector and conducts interviews with CEOs and policymakers.

w.baan@farmerbusiness.com