Shares of Honeywell Flour Mills Plc have climbed 32% month-to-date, making it the top-advancing consumer goods stock on the Nigerian Exchange so far in early January.
The surge comes after Flour Mills of Nigeria (FMN), which holds a 71.69% stake in the company, relaunched the Honeywell brand in mid-December 2024.
According to Mr. Devlin Hainsworth, Managing Director (Food) at FMN, the relaunch aims to redefine and strengthen the brand’s presence in the market.
Following the relaunch, Honeywell Flour Mills Plc has recorded gains in five of its last six trading sessions in early January, reflecting sustained investor interest.
Market trend
In 2024, Honeywell Flour Mills recorded an 89.8% year-to-date gain on the Nigerian Exchange, supported by renewed bullish activity in the latter half of the year.
- The stock opened at N3.32 in January, rising to N3.95 with a trading volume of 127 million shares.
- It declined to N3.00 by May before recovering in June, reaching N4 in August and N4.70 by September.
- In the fourth quarter, the stock saw increased activity, with a notable rise in December that contributed over 30% to its annual performance, bringing the year-to-date gain to 89.75%.
Possible drivers of bullish action
Honeywell Flour Mills saw an uptick in its stock price likely due to a few developments:
- The company reported a 126% year-over-year increase in revenue, jumping from N79.4 billion to N179.5 billion for the six months ending September 30, 2024.
- This growth was accompanied by a 186% rise in pre-tax profit, reaching N3.4 billion, compared to a loss of N3.9 billion the previous year.
After the earnings report release on October 30, 2024, Honeywell’s shares closed at N4.73 in November.
- In mid-December, Flour Mills of Nigeria (FMN), which holds a 71.69% stake in Honeywell, relaunched the Honeywell brand.
- This initiative sought to enhance market presence and product quality, introducing new packaging inspired by Nigerian culture.
Following the relaunch, Honeywell’s shares began to rise on December 16, breaking the N6 barrier and closing the month at N6.30.
Comments on the Honeywell relaunch
According to Mr. Devlin Hainsworth, Managing Director (Food) at Flour Mills of Nigeria (FMN), the company is focused on improving the quality of its products. “The Honeywell brand offers improved quality noodles and pasta, while the Honeywell semo or wheat provides enhanced quality and adjusted pack sizes,” he said.
- He added that the new packaging reflects Nigeria’s culture and the brand’s history, with upgraded products offering better nutritional value and taste.
- However, on the 30th of December 2024, the Nigerian Exchange stated that the entire issued share capital of Flour Mills of Nigeria has been delisted from the Daily Official List.
- This stems from a September 24, 2024, announcement by Flour Mills of Nigeria Plc, disclosing that its majority shareholder, Excelsior Shipping Company Limited, had proposed to acquire all minority-held shares, paving the way for the company’s exit from the Nigerian Exchange.
Shares of Flour Mills last traded on December 13, 2024, closing at N81.80 with a monthly market volume of 11 million shares and a year-to-date performance of 147.50%.
