Fan Milk PLC, a leading dairy and frozen foods company in Ghana, has released its unaudited financial statements for the year ended December 31, 2024, showcasing a 24% increase in revenue and a significant improvement in profitability.
Despite challenges in the export business, the company achieved a strong financial performance, driven by productivity initiatives and strategic sales promotions.
Financial
Fan Milk PLC reported a 24% increase in revenue, rising to GHS 683.8 million in 2024 from GHS 549.4 million in 2023. This growth was driven by improved product availability, better product mix, and effective sales promotions. However, the export business declined by 18% due to challenges with receivables, which impacted overall revenue growth.
Gross profit increased to GHS 257.7 million, up from GHS 171.3 million in 2023, reflecting a gross profit margin improvement. This was achieved through material price negotiations, productivity initiatives, and strategic sales promotions. Operating profit also saw a significant rise, reaching GHS 79.4 million, compared to GHS 30.5 million in 2023, with the operating profit margin improving from 6% to 12%.
Net profit after tax more than doubled, standing at GHS 54.2 million, up from GHS 24 million in 2023. Earnings per share (EPS) also increased to GHS 0.467, compared to GHS 0.207 in the previous year.
Cost Management and Operational Efficiency
Despite soaring input costs due to high inflation and unfavorable exchange rates, Fan Milk PLC managed to control costs effectively. The company’s cost of sales increased to GHS 426.1 million from GHS 378.1 million, but this was offset by higher revenue and improved gross margins. Administrative expenses rose to GHS 61.7 million from GHS 40 million, reflecting increased operational activities.
Cash Flow and Balance Sheet Strength
Fan Milk PLC generated GHS 159.3 million in cash from operating activities, up from GHS 34.1 million in 2023. Net cash generated from operating activities stood at GHS 143.2 million, compared to GHS 27.2 million in the previous year. The company invested GHS 40.1 million in property, plant, and equipment, reflecting its commitment to maintaining and expanding its production capacity.
The company’s cash and cash equivalents increased to GHS 109.1 million at the end of 2024, up from GHS 65.9 million in 2023. Total assets also grew to GHS 604.7 million from GHS 590.3 million, while total equity increased to GHS 277.5 million from GHS 232.4 million.
Strategic Outlook
Fan Milk PLC remains focused on driving growth through productivity initiatives, cost management, and strategic sales promotions. The company plans to continue expanding its customer base and improving product availability to sustain its upward trajectory. Management is also exploring opportunities to address challenges in the export business and enhance overall profitability.
In a joint statement, Freda Duplan, Board Chairman, and Lionel Parent, Managing Director, expressed confidence in the company’s future prospects. “Despite the challenges in the export business, we are pleased with the strong performance in 2024. Our focus on productivity, cost management, and strategic sales promotions has yielded positive results, and we remain committed to delivering value to our stakeholders in the coming year.”
Fan Milk PLC’s 2024 financial results reflect a company that has successfully navigated a challenging operating environment. With strong revenue growth, improved profitability, and a solid balance sheet, Fan Milk PLC is well-positioned to continue delivering value to its shareholders and customers in 2025 and beyond.
