Onome Amuge
BUA Foods PLC is seeking to parlay a year of record profits into long-term dominance of Nigeria’s food industry, unveiling a multi-billion-naira capacity expansion plan that underscores the strategic role of large corporates in the country’s food security agenda.
The consumer goods giant, majority-owned by billionaire industrialist Abdul Samad Rabiu, reported a 109 per cent jump in revenues to N1.53 trillion in 2024, as higher volumes and pricing power across its sugar, flour, pasta and rice divisions propelled growth. Net profit rose 137 per cent to N265.9 billion, while earnings per share almost doubled to N14.78.
Yet beyond the headline numbers, the company used its annual general meeting in Abuja this week to lay out an aggressive expansion roadmap that will shape Nigeria’s food supply chain for years to come.
Rabiu told shareholders the group was doubling down on investments in manufacturing infrastructure to address persistent supply deficits in Nigeria’s staple food markets.
The centrepiece is a large-scale expansion of its pasta division, with nine additional long-cut pasta lines set to double output. Four new wheat milling plants are also planned for the flour business, designed to significantly raise domestic milling capacity at a time when Nigeria relies heavily on imports to meet demand.
Meanwhile, BUA’s sugar project, pitched as a cornerstone for the company’s backward integration strategy, remains on track for delivery, boosting efforts to reduce import dependence in one of the country’s most politically sensitive commodities.
“These projects will not only strengthen our manufacturing capabilities and reinforce our market leadership but will also create new job opportunities, contributing positively to national economic development,” Rabiu said.
The scale of the company’s success was underlined by a sharp increase in shareholder returns. Investors approved a N13 per share dividend, more than double the N5.50 paid last year, after BUA Foods’ share price more than doubled to N415 in 2024, lifting its market capitalisation to N7.47 trillion.
The company’s results came despite challenges, including rising input costs and foreign exchange volatility that has battered many corporates in Africa’s largest economy. Managing Director Ayodele Abioye credited strategic investments in capacity expansion, market penetration, and product diversification for insulating the business from macroeconomic headwinds.
But analysts caution that execution risks loom large. Import reliance for raw materials such as wheat exposes the group to currency swings, while Nigeria’s struggling power and transport infrastructure add to production costs.
Still, BUA Foods’ expansion dovetails with the government’s wider food security push. Nigeria has battled shortfalls in staple foods, exacerbated by climate change, insecurity in farming regions and dollar shortages curbing imports.
By investing heavily in domestic production, BUA is aligning with policy priorities while positioning itself as a critical player in ensuring steady supply. “As we navigate an evolving business landscape, we remain confident in our ability to seize opportunities, manage risks, and drive long-term sustainable growth,” Rabiu said.
The company’s bet is that private sector-led industrial capacity can plug Nigeria’s food gaps faster than public initiatives. If successful, it could cement BUA Foods not only as a market leader but also as a linchpin in the country’s quest for food self-sufficiency.
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