UAC Profit Hits Three-Year Low on N21bn Chivita, Hollandia Acquisition
UAC of Nigeria Plc saw its profit fall to the lowest level since 2022 last year, weighed down by hefty one-off costs linked to its acquisition of CHI Limited, the maker of Chivita and Hollandia.
According to its earnings reports released on Monday, after-tax profit dropped to N504 million from N16.3 billion in 2024.
The consumer goods conglomerate completed the 100 percent acquisition of CHI Limited on October 3, bringing the market-leading dairy and juice producer fully into its fold.
Following the completion, CHI was consolidated into UAC’s financial statements from the fourth quarter of 2025, according to the report.
With the deal, UAC now operates two businesses in the packaged food and beverages segment: UAC Foods Limited and CHI Limited, which owns brands such as Chivita and Hollandia.
Commenting on the results, Fola Aiyesimoju, group managing director, described 2025 as a “pivotal year” for the company.
“The completion of the acquisition of CHI Limited significantly increased the scale of our Group, with revenue reaching 343 billion, a 74 percent increase compared to 2024,” Aiyesimoju said.
He noted that CHI expanded UAC’s portfolio into large, fast-growing categories such as drinking yoghurt, evaporated milk, and juices, anchored by the Chivita, Hollandia, and Capri-Sun brands, while SuperBite and Beefie complement its existing snacks business.
Despite the strong top-line growth, profitability was hit by exceptional costs. Group revenue rose 74 percent to N343.4 billion, while operating profit increased 15 percent to N21.6 billion.
However, one-off acquisition-related expenses and higher finance costs eroded earnings.
UAC recorded N21 billion in exceptional acquisition costs during the year.
Excluding these, profit before exceptional items rose 76 percent to N29 billion, from N16 billion in 2024.
Finance costs surged 301.6 percent to N26.85 billion, driven by increased borrowings used to fund the acquisition and support import financing, as well as a N6.8 billion fair-value loss on a US dollar forward contract used for acquisition financing, which was settled in December.
As a result, the group posted a net finance cost of N17.54 billion, up from N5.96 billion in the prior year.
Analysts at CSL Research expect a short-term, knee-jerk reaction from investors following the release of UAC’s unaudited full-year results.
“While near-term earnings were impacted by one-off acquisition costs and higher finance expenses, UAC’s underlying fundamentals remain solid,” the firm said. “The acquisition of CHI Limited materially enhances the company’s scale, brand portfolio, and market presence, positioning it for sustained medium-term growth in the food and beverage segment.”
