Unilever Nigeria receives N5.4 billion as proceeds for selling its tea business

Unilever Nigeria Plc disposed of its tea business to Unilever Tea MSO Nigeria Limited, a related party within the Unilever Group, for a considerable amount of N5.4 billion during the period ended December 31, 2021.

This was disclosed in the Audited Financial Statement recently filed with the Nigerian Exchange Limited.

The Unilever tea business was included in the discontinued operations segment of the financial statement, which revealed that the company had also disposed of property, plants and equipment as well as long service award obligations.

Before the company’s business was discontinued in October 2021, it had a turnover of N9.05 billion from January – to September 2021, a 7.17% decline from what it generated in the corresponding period of 2020. However, the tea business moved from a loss position to rake in a profit of N2.72 billion in the 9-month period of 2021.

Backstory

Nairametrics had reported earlier that Unilever Nigeria confirmed its intent to spin off its tea business into a separate legal entity, a move that could potentially affect its top-line revenue.

Recall that in November 2021, Unilever Group Plc announced that it had agreed to sell its global tea business, ekaterra, to CVC Capital Partners for €4.5 billion on a cash-free, debt-free basis.

• According to Alan Jope, CEO of Unilever, “The evolution of our portfolio into higher-growth spaces is an important part of our growth strategy for Unilever. Our decision to sell ekaterra demonstrates further progress in delivering against our plans.
• “We are proud of the place that our Tea business has in our company’s history. We look forward to seeing ekaterra, with its strong brands and global footprint, prosper under CVC’s ownership. I would like to thank our Tea colleagues around the world for their passion and commitment to our Tea business and wish them well for the future.”
• The completion of the transaction is expected to be finalized in the second half of 2022 and is subject to the completion of works council consultation processes and the receipt of certain regulatory approvals.

What you should know

Unilever Nigeria Plc had released its Audited 2021 financial results earlier, for the period ended 31 December 2021, reporting a profit of N688 million, from a loss position of N3.76 billion year on year. Revenue of N70.52 billion was reported in the full-year period compared to N52.21 billion in the same period of 2020, representing a 35% increase.

• Unilever Nig Plc has earnings per share (EPS) for the period at N0.59, from a loss per share of N0.69 in FY 2020. The company’s board of directors have recommended the payment of N0.50 kobo as dividend for the financial year ended 31 December 2021, reaching a total consideration of N2,872,502,500.
• The dividends will be payable to shareholders on Friday, May 6, 2022, and will be subject to the deduction of withholding tax at the appropriate rate at the time of payment.
• Unilever Nig Plc last traded at N13.30 per share and has declined 8.28% from year-to-date.

Article Originally Published Here