FrieslandCampina Nigeria, the country’s foremost dairy producer, sees no quick fix at least this year to the complications an unusually vast foreign exchange expense has caused in its operations.
According to details of its recently issued first-half earnings report, the company’s financials took a pounding after continuous depreciation of the naira increased the exchange rate of the naira to the dollar and sent its long arrears of payables to foreign trade partners soaring in local currency.
At N18.6 billion, foreign currency costs ate up what was posted in gross profit, throwing its bottom line into a loss of N11.6 billion, the first time in five years or more.
“The company foresees that the results for the year will be impacted, as we do not expect a full recovery of this significant exceptional expense in this financial year,” it said.
The local subsidiary of Amersfoort-based Royal FrieslandCampina N.V., itself the world’s biggest dairy cooperative,…
