CADBURY NIGERIA : QUARTER 3 - FINANCIAL STATEMENT FOR 2023

Cadbury Nigeria Plc

Un-audited Interim Financial Information for the Nine Months Ended 30 September 2023

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Content	Page
Financial highlights	2
Statement of financial position	3
Statement of profit or loss and other comprehensive income	4
Statement of changes in equity	5
Statement of cashflows	6
Notes to the financial information	7

1

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Financial highlights

For the Nine Months Ended 30 September 2023

In thousands of naira

	Un-audited		Un-audited
	30 September		30 September
	2023		2022		Change %
Revenue	59,201,260	42,540,017	39
Gross profit	16,307,408	8,375,749	95
Results from operating activities	9,649,238	3,311,646	191
(Loss)/Profit before tax	(10,242,573)	4,023,809	(355)
(Loss)/Profit for the period	(10,242,573)	2,816,666	(464)
Share capital	939,101	939,101	-
Total equity	2,872,027	15,512,508	(81)
Data per 50k share
Basic (loss)/earnings per share	(545.34)	149.97	(464)
Net asset per share	153	826	(81)

2

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Statement of financial position

As at 30 September 2023

In thousands of naira

		Un-audited		Audited
		30 September		31 December
Assets	Note	2023	2022
Non-current assets		15,539,965	14,070,993
Property, plant and equipment	9
Right-of-use assets	18	40,391	38,973
Intangible assets	10	2,116	6,813
Total non-current assets		15,582,472		14,116,779
Current assets		11,782,299	11,913,166
Inventories	11
Trade and other receivables	12	6,810,093	5,164,146
Prepayments	13	730,727	1,071,815
Cash and cash equivalents	14	41,540,183	27,447,778
Total current assets		60,863,302		45,596,905
Total assets		76,445,774		59,713,684
Equity and liabilities
Equity		939,101	939,101
Share capital
Share premium		272,344	272,344
Other reserves		3,436,348	3,436,348
Share based payment reserve	15	176,896	176,896
Retained earnings		(1,952,662)	8,477,939
Total equity		2,872,027		13,302,628
Liabilities
Non-current liabilities		19,989,238	7,640,590
Borrowings	19
Deferred taxation		1,092,687	1,092,687
Employee benefits		678,313	576,884
Lease liabilities	18	11,551	12,494
Total non-current liabilities		21,771,789		9,322,655
Current liabilities		29,604,126	16,219,870
Borrowings	19
Current tax liabilities	8	73,201	383,006
Trade and other payables	16	22,123,966	20,484,918
Lease liabilities	18	665	606
Total current liabilities		51,801,958		37,088,401
Total liabilities
	73,573,747		46,411,056
Total equity and liabilities		76,445,774		59,713,684

These financial statements were approved by the Board of Directors on 24 October 2023 and signed on its behalf by:

Oyeyimika Adeboye (Managing Director) ) FRC/2013/ICAN/00000001089

Ogaga Ologe (Finance Director) ) FRC/2013/ICAN/00000001091

The accompanying notes on pages 7 to 23 form an integral part of these financial statements.

3

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Statement of profit or loss and other comprehensive income

For the Nine Months Ended 30 September 2023

		Un-audited		Un-audited		Un-audited		Un-audited
		1 July-30 Sept		30 September		1 July-30 Sept		30 September
In thousands of naira	Note	2023		2023		2022		2022
Revenue	5	23,593,496	59,201,260	14,663,345	42,540,017
Cost of sales		(17,515,656)	(42,893,852)	(12,141,500)	(34,164,268)
Gross profit		6,077,841		16,307,408		2,521,845		8,375,749
Other income	6	59,559	66,615	54,352	79,981
Selling and distribution expenses		(1,833,627)	(5,194,210)	(1,608,528)	(4,050,697)
Administrative expenses		(726,661)	(1,530,575)	(504,389)	(1,093,387)
Results from operating activities		3,577,111		9,649,238		463,280		3,311,646
Net finance income/(cost)	7	719,784		(19,891,811)		215,117		712,163
Profit/(Loss) before tax		4,296,895	(10,242,573)	678,397	4,023,809
Income tax expense	8	-	-	(203,519)	(1,207,143)
Profit/(Loss) for the period
	4,296,895		(10,242,573)		474,877		2,816,666
Other comprehensive income
	-		-		-		-
Total comprehensive Income/(Loss) for the period	4,296,895		(10,242,573)		474,877		2,816,666
Basic earnings/(loss) per share (kobo)		228.78	(545.34)	25.28	149.97

The accompanying notes on pages 7 to 23 form an integral part of these financial statements.

4

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Statement of changes in equity

Attributable to equity owners of the company

For the Nine Months Ended 30 September 2023

In thousands of naira

							Shared based		Retained
	Share capital		Share premium		Other reserves		payment		earnings		Total equity
Balance at 1 January 2023	939,101		272,344		3,436,348		176,896		8,477,939		13,302,628
Comprehensive income for the period	-	-	-	-	(10,242,573)	(10,242,573)
Profit for the period
Other Comprehensive income	-	-	-	-	-	-
Total comprehensive loss for the period	-		-		-		-		(10,242,573)		(10,242,573)
Transactions with owners, recorded directly in equity	-	-			-	(188,028)	(188,028)
Dividends to equity holders
Total transactions with owners	-		-		-		-		(188,028)		(188,028)
Balance at 30 September 2023
939,101	272,344	3,436,348	176,896	(1,952,662)	2,872,027
							Shared based		Retained
In thousands of naira	Share capital		Share premium		Other reserves		payment		earnings		Total equity
Balance at 1 January 2022	939,101	272,344	3,436,348	153,220	8,835,341	13,636,354
Comprehensive income for the period	-	-	-	-	2,816,666	2,816,666
Profit for the period
Other Comprehensive income	-	-	-	-	-	-
Total comprehensive income for the period	-		-		-		-		2,816,666	2,816,666
Transactions with owners, recorded directly in equity	-	-	-	-	(940,512)	(940,512)
Dividends to equity holders
Total transactions with owners	-		-		-		-		(940,512)		(940,512)
Balance at 30 September 2022
939,101	272,344	3,436,348	153,220	10,711,495	15,512,508

The accompanying notes on pages 7 to 23 form an integral part of these financial statements.

5

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Statement of cash flows

For the Nine Months Ended 30 September 2023

In thousands of naira

	Un-audited		Un-audited
In thousands of naira	30 September		30 September
2023		2022
Cash flow from operating activities	(10,242,573)	4,023,809
(Loss)/profit before tax
Adjustments for:	1,202,832	1,107,786
Depreciation of property, plant and equipment
Depreciation of ROU asset	13,762	13,527
Amortisation of intangible assets	4,697	4,697
Finance income	(1,797,423)	(1,055,016)
Exchange difference	1,031,861	-
Loss/(gain) on sale of property, plant and equipment	136	(46,953)
Accretion of interest	866	330
Interest on borrowings	810,144	342,523
Expense for employee benefits	101,429	99,273
	(8,874,270)		4,489,976
Change in:	130,867	(3,443,748)
Inventories
Trade and other receivables	(1,645,947)	(3,942,987)
Prepayments	341,088	211,636
Trade and other payables	3,174,219	5,938,668
Cash used in/generated from operating activities	(6,874,043)		3,253,545
VAT paid	(1,535,171)	(1,448,156)
Income tax paid	(309,805)	(7,826)
Net cash used in/generated from operating activities	(8,719,019)		1,797,563
Cash flow from investing activities	1,797,423	1,055,016
Finance income
Proceeds from sale of property, plant and equipment	-	105,535
Acquisition of right of use assets	(15,180)	-
Acquisition of property, plant and equipment	(2,671,940)	(2,138,907)
Net cash used in investing activities	(889,697)		(978,356)
Cash flow from financing activities	(188,028)	-
Dividends paid
Additions to intercompany loan	6,103,105	-
Addition - Import finance facilities	31,839,134	6,902,089
Repayment - Import finance facilities	(18,454,878)	(1,853,642)
Exchange gain on Intercompany loan	5,435,399	156,892
Lease liabilities	(1,750)	(7,043)
Net cash generated from financing activities	24,732,982		5,198,296
Net increase in cash and cash equivalents	15,124,265	6,017,503
Cash and cash equivalents at 1 January	27,447,778	17,824,131
Exchange gain on foreign currency cash and cash equivalents	(1,031,861)	-
Cash and cash equivalents at 30 September	41,540,183		23,841,634

The accompanying notes on pages 7 to 23 form an integral part of these financial statements.

6

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Notes to the financial information

1. Reporting entity
   Cadbury Nigeria Plc is a company domiciled in Nigeria. The address of the Company's registered office is Lateef Jakande Road, Ikeja, Lagos. The Company is principally engaged in the manufacture and sale of branded fast moving consumer goods mostly to the Nigerian market, but also for exports.
   The Company's brands fall into four principal categories, namely refreshment beverages, confectionery, biscuit and intermediate cocoa products. Cadbury Bournvita and 3-in-1 Hot Chocolate are the refreshment beverages, TomTom, Candy Caramel, Candy Coffee, Buttermint and Clorets gum are the confectionery products, Bournvita Biscuit is the biscuit category while Cocoa Butter is a key product in the intermediate cocoa category.
   Cadbury Nigeria Plc is owned 74.97% (2022: 74.97%) by Cadbury Schweppes Overseas Limited ("CSOL"), incorporated in the United
   Kingdom while CSOL is owned by Mondelez International and 25.03% (2022: 25.03%) by a highly diversified spread of individual and institutional shareholders.
2. Basis of preparation
3. 1. Statement of compliance
      The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and interpretations issued by the IFRS Interpretations Committee (IFRS IC) applicable to companies reporting under IFRS and in the manner required by the Companies and Allied Matter Act 2020 and the Financial Reporting Council of Nigeria Act 2011. The financial statements comply with IFRS as issued by the International Accounting Standards Board (IASB). They were authorized for issue by the Company's Board of Directors on 24 July 2023.
   2. Basis of preparation
      These financial statements have been prepared under the historical cost basis except for the following:
   3. • Liabilities for equity-settledshare-based payment arrangements - fair value
      • Defined benefit obligations - present value of the obligation
      • Inventory - lower of cost and net realizable value

The methods used to measure fair values are discussed further in note 4.

These financial statements cover the unaudited interim financial information for half year ended 30 June 2023, with comparative amounts for the financial year ended 31 December 2022 for the financial position (audited), unaudited comparative for both profit and loss and cashflows statement .

1. Functional and presentation currency
   These financial statements are presented in Naira, which is the Company's functional currency. All financial information presented in Naira has been rounded to the nearest thousands, except when otherwise indicated.
2. Use of estimates and judgments
   The preparation of the financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
   Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

3 Significant accounting policies

The accounting policies set out below have been applied consistently to all years presented in these financial statements.

1. Foreign currency transactions
   Transactions denominated in foreign currencies are translated and recorded in Naira at the actual exchange rates as of the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated at the rates of exchange prevailing at that date. The foreign currency gain or loss on monetary items is the difference between amortized cost in the functional currency at the beginning of the period, adjusted for effective interest and payments during the period, and the amortized cost in foreign currency translated at the exchange rate at the end of the reporting period. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated to the functional currency at the exchange rate at the date that the fair value was determined.
   Foreign currency differences arising on translation are recognized in profit or loss. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

7

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Notes to the financial information (Continued)

3 Significant accounting policies (Continued)

1. Financial instruments
2. 1. Classification and measurement Financial assets

It is the Company's policy to initially recognise financial assets at fair value plus transaction costs, except in the case of financial assets recorded at fair value through profit or loss which are expensed in profit or loss.

Classification and subsequent measurement is dependent on the Company's business model for managing the asset and the cashflow characteristics of the asset. On this basis, the Company classifies its financial instruments at amortised cost.

The business models applied to assess the classification of the financial assets held by the company are:

Hold to collect: Financial assets in this category are held by the Company solely to collect contractual cash flows and these cash flows represents solely payments of principal and interest. Assets held under this business model are measured at amortised cost.

Fair value through other comprehensive income: Financial assets in this category are held to collect contractual cash flows and sell where there are advantageous opportunities. The cash flows represents solely payment of principal and interest. These financial assets are measured at fair value through other comprehensive income.

Fair value through profit or loss: This category is the residual category for financial assets that do not meet the criteria described above. Financial assets in this category are managed in order to realise the asset's fair value.

The business model for the Company's financial assets are held to collect contractual cashflows that are solely payments of principal (for non-interest bearing financial assets) or solely payments of principal and interest (for interest bearing financial assets).

The Company's financial assets include trade and other receivables, cash and cash equivalents and due from related parties. They are included in current assets, except for maturities greater than 12 months after the reporting date. Interest income from these assets is included in finance income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in finance income/cost.

Financial liabilities

Financial liabilities of the Company are classified and measured at fair value on initial recognition and subsequently at amortised cost net of directly attributable transaction costs.

The Company's financial liabilities include trade and other payables, borrowings, lease liabilities and amounts due to related parties.

ii) Impairment of financial assets

Recognition of impairment provisions under IFRS 9 is based on the expected credit loss (ECL) model. The ECL model is applicable to financial assets classified at amortised cost under IFRS 9: Financial instruments. The measurement of ECL reflects an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes, time value of money and reasonable and supportable information that is available without undue cost or effort at the reporting date, about past events, current conditions and forecasts of future economic conditions.

The general approach assesses impairment based on changes in credit risk since initial recognition using the past due criterion. Financial assets classified as stage 1 have their ECL measured as a proportion of their lifetime ECL that results from possible default events that can occur within one year, while assets in stage 2 or 3 have their ECL measured on a lifetime basis. Non-trade receivables from related parties have been assessed for impairment under this approach.

The simplified approach is applied for trade receivables from related parties and third party customers. The simplified approach requires expected lifetime losses to be recognised from initial recognition of the receivables. This involves determining the expected loss rates using a provision matrix that is based on the Company's historical default rates observed over the expected life of the receivable and adjusted forward-looking estimates. This is then applied to the gross carrying amount of the receivable to arrive at the loss allowance for the period.

Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of the related financial assets and the amount of the loss is recognised in profit or loss.

In line with the Company's credit risk management practices, a financial asset is defined to be in default when contractual payments have not been received at least 90 days after the contractual payment period. Subsequent to default, the Company carries out active recovery strategies to recover all outstanding payments due on receivables. Where the Company determines that there are no realistic prospects of recovery, the financial asset, and any related loss allowance is written off either partially or in full.

8

Cadbury Nigeria Plc Un-auditedInterim Financial Information for the Nine Months ended 30 September 2023

Notes to the financial information (Continued)

3 Significant accounting policies (Continued)

iii) Derecognition Financial assets

The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire or when it transfers the financial asset and the transfer qualifies for derecognition. Gains or losses on derecognition of financial assets are recognised as finance income/cost.

Financial liabilities

The Company derecognises a financial liability when it is extinguished i.e. when the obligation specified in the contract is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised immediately in the statement of profit or loss.

iv) Offsetting of financial assets and financial liabilities

Financial assets and liabilities are offset and the net amount is reported in the statement of financial position. Offsetting can be applied when there is a legally enforceable right to offset the recognised amounts, and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

The legally enforceable right is not contingent on future events and is enforceable in the normal course of business, and in the event of default, insolvency or bankruptcy of the Company or the counterparty.

1. Property, plant and equipment

1. Recognition and measurement
2. 1. 
      Items of property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset. Property, plant and equipment under construction are disclosed as capital work-in-progress. The cost of construction recognised includes the cost of materials and direct labor, any other costs directly attributable to bringing the assets to a working condition for their intended use, the costs of dismantling and removing the items and restoring the site on which they are located, and borrowing costs on qualifying assets.
      Purchased software that is integral to the functionality of the related equipment is capitalized as part of the equipment. When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. Gains or losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment, and are recognized as profit or loss in the statement of profit or loss and other comprehensive income.
   2. Subsequent costs
      Subsequent expenditure is capitalized only when it is probable that the future economic benefits associated with the expenditure will flow to the Company. Ongoing repairs and maintenance are expensed as incurred. The cost of replacing a part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Company.
   3. Depreciation and impairment
      Items of property, plant and equipment are depreciated from the date they are available for use or, in respect of capital-work-in- progress, from the date that the asset is completed and ready for use.
      Depreciation is calculated to write off the cost of items of property, plant and equipment less their estimated residual values using a straight-line basis over their estimated useful lives. Depreciation is generally recognized in profit or loss, unless the amount is included in the carrying amount of another asset. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Company will obtain ownership by the end of the lease term in which case the assets are depreciated over the useful life.
      The estimated useful lives for the current and comparative years of significant items of property, plant and equipment are as follows:

● Freehold land
● Buildings	40 years
● Plant and Machinery
o Power Generating Equipment	20 years
o Packaging Equipment	15 years
o Food and Candy Processing Equipment	15 years
o Totebins	2 years
● Motor Vehicles	4 years
● Office furniture and Equipment	6.67 years

9