Unilever Nigeria H1 profit up 21% despite N1.3bn forex hit
Unilever Nigeria delivered a 73% surge in operating profit for the first half of 2026 on the back of strong Foods revenue growth, though a foreign exchange loss capped bottom-line gains and left the heavily rallied stock flat.
Unilever Nigeria posted a pre-tax profit of N29.2 billion for the first half of 2026, a 20.8% increase from the prior year. Revenue climbed 22.2% to N119.9 billion, driven primarily by a 31.3% surge in its Foods segment, which accounted for 64% of total sales. Personal Care and Beauty & Wellbeing also contributed, while export revenue jumped 85.8% to N2.72 billion, though Nigeria remained the dominant market at 98% of sales.
This top-line growth outpaced a 16.4% rise in the cost of sales, pushing gross profit up 30% to N54.7 billion. Operating leverage drove operating profit up 72.8% to N42.1 billion, even as the company absorbed higher selling, distribution, and marketing expenses. Despite this operational outperformance, bottom-line growth was constrained to 8.3%, with profit after tax reaching N15.6 billion.
The primary drag on net income came from finance costs, which spiked to N1.70 billion from N483.5 million a year earlier. This increase was driven almost entirely by a N1.33 billion foreign exchange loss on bank balances, a factor absent in the 2025 comparative period. While finance income rose 11.8% to N6.51 billion on higher deposit interest, the FX hit reduced net finance income.
The company declared an interim dividend of N2.00 per share, with a qualification date of 31 July and payment on 14 August. On the balance sheet, total assets slipped 1.6% to N177.2 billion, largely due to a 12.3% decline in cash to N97.2 billion. Even with this reduction, cash still represents approximately 55% of total assets, while total borrowings remained marginal at N2.1 billion.
Total equity declined 3.1% to N104.4 billion despite the accrued profit, suggesting dividend distributions or currency translation effects weighed on retained earnings. Investors appeared to look past the operational strength, leaving the stock flat at N125.00 on the day of the results. The shares have already delivered a 116% return over the past year and are up 73.6% year-to-date, indicating the strong H1 performance had largely been anticipated.
