Naira Devaluation Hits Companies Hard as Six Firms Record ₦255bn FX Loss
The persistent depreciation of the naira has led to significant foreign exchange (FX) losses for six companies listed on the Nigerian Exchange Limited (NGX), amounting to a combined ₦255.72 billion in their financial results for the year ended December 31, 2024.
Key Affected Companies & FX Losses:
1. BUA Foods – ₦188.7bn (up from ₦81.86bn in 2023)
2. Caverton Offshore Support Group – ₦43.49bn (up from ₦4.65bn in 2023)
3. Honeywell Flour Mills – ₦8.56bn (down from ₦20.19bn in 2023)
4. FTN Cocoa Processors – ₦11.68bn (up from ₦10.18bn in 2023)
5. Beta Glass Plc – ₦2.00bn (down from a ₦1.79bn gain in 2023)
6. MRS Oil Nigeria – ₦1.29bn (down from ₦3.22bn in 2023)
Impact on Business Performance
Despite recording the highest FX loss, BUA Foods remained profitable, posting a ₦289.1bn profit before tax and ₦274.9bn net profit after tax.
However, Caverton Offshore Support Group reported an overall operating loss of ₦50.53bn, largely driven by the steep rise in FX losses.
Other financial highlights:
• Honeywell Flour Mills saw its revenue grow from ₦123.99bn in 2023 to ₦277.06bn in 2024 despite the losses.
• Beta Glass Plc recorded ₦117.58bn in revenue, up from ₦62.91bn in 2023, with an improved operating profit of ₦24.39bn.
• MRS Oil Nigeria saw its revenue jump from ₦182.31bn in 2023 to ₦312.23bn in 2024, with an operating profit of ₦9.65bn.
Cause of FX Losses
The losses were primarily driven by the devaluation of the naira following the Central Bank of Nigeria’s exchange rate unification policy, which increased the cost of servicing foreign currency liabilities.
Market Outlook & Analysts’ Warnings
Analysts warn that unless Nigeria achieves foreign exchange stability, more companies could face deeper losses in 2025, potentially affecting investor confidence and market stability.
This comes amid a broader decline in Nigeria’s foreign reserves, which fell by $832.62 million in just two weeks in January 2025, raising concerns about the country’s external liquidity and economic outlook.
The persistent depreciation of the naira has led to significant foreign exchange (FX) losses for six companies listed on the Nigerian Exchange Limited (NGX), amounting to a combined ₦255.72 billion in their financial results for the year ended December 31, 2024.
Key Affected Companies & FX Losses:
1. BUA Foods – ₦188.7bn (up from ₦81.86bn in 2023)
2. Caverton Offshore Support Group – ₦43.49bn (up from ₦4.65bn in 2023)
3. Honeywell Flour Mills – ₦8.56bn (down from ₦20.19bn in 2023)
4. FTN Cocoa Processors – ₦11.68bn (up from ₦10.18bn in 2023)
5. Beta Glass Plc – ₦2.00bn (down from a ₦1.79bn gain in 2023)
6. MRS Oil Nigeria – ₦1.29bn (down from ₦3.22bn in 2023)
Impact on Business Performance
Despite recording the highest FX loss, BUA Foods remained profitable, posting a ₦289.1bn profit before tax and ₦274.9bn net profit after tax.
However, Caverton Offshore Support Group reported an overall operating loss of ₦50.53bn, largely driven by the steep rise in FX losses.
Other financial highlights:
• Honeywell Flour Mills saw its revenue grow from ₦123.99bn in 2023 to ₦277.06bn in 2024 despite the losses.
• Beta Glass Plc recorded ₦117.58bn in revenue, up from ₦62.91bn in 2023, with an improved operating profit of ₦24.39bn.
• MRS Oil Nigeria saw its revenue jump from ₦182.31bn in 2023 to ₦312.23bn in 2024, with an operating profit of ₦9.65bn.
Cause of FX Losses
The losses were primarily driven by the devaluation of the naira following the Central Bank of Nigeria’s exchange rate unification policy, which increased the cost of servicing foreign currency liabilities.
Market Outlook & Analysts’ Warnings
Analysts warn that unless Nigeria achieves foreign exchange stability, more companies could face deeper losses in 2025, potentially affecting investor confidence and market stability.
This comes amid a broader decline in Nigeria’s foreign reserves, which fell by $832.62 million in just two weeks in January 2025, raising concerns about the country’s external liquidity and economic outlook.