FanMilk hit with first loss in 5 years -No dividend for shareholders

BY: Maxwell Akalaare Adombila
Ziobeieton Yeo, MD- Fanmilk Ghana

FANMILK Ghana’s profit has hit the red line for the first time in five years.

The diary giant posted a loss of GH¢13.43 million in 2021, marking the lowest point of a profit decline that started in 2019.

Consequently, the company’s Board of Directors have given a hint of its intentions not to recommend the payment of dividend for the year ended December 31, 2021 when an annual general meeting is held later this year.

Product line

Its annual report for last year showed that revenues were, however, strong.

They grew by more than a quarter to GH¢468.09 million last year albeit insufficient to cancel out the effects of high cost of operations in the midst of weak sales.

The report indicated that all FanMilk’s product line – dairy, juice, ice cream and plant-based milk – recorded growth in sales last year.


The company’s annual reports showed that after net profit peaked at GH¢47.3 million in 2017, it fell by almost three quarters to GH¢12.89 million in 2018 but doubled up to GH¢25.02 million the following year.

Since then, the net profit has been on the decline. It fell to about GH¢514,000 in 2020 but took a nosedive to record a loss of GH¢13.43 million last year.

Loss drivers

Last year’s loss was driven largely by weak sales and higher increments in general operational expense.

The company’s expenses rose by almost a third to GH¢468.1 million last year, buoyed by strong increment in impairment of financial assets (74 per cent), finance costs (61 per cent), cost of sales (30 per cent), cost of raw materials and consumables (30.24 per cent).

Finance costs rose from GH¢2.07 million in 2020 to GH¢3.32 last year.

No dividend

Following the loss, the company said in the annual report that the directors did not recommend the payment of dividend for the year ended December 31, 2021.

FanMilk’s balance sheet was also weakened by a 5.15 per cent decline in net assets.

The report said net assets decreased from GH¢260.1 million as of December 2020 to GH¢246.7 million as of December 2021.

Share price

The company said in the annual report that its shares did well on the Ghana Stock Exchange (GSE) in 2021.

It said the price appreciated by about 270 per cent from GH¢1.08 per share in January 2021 to GH¢4 per share by December 31, last year.

On capital expenditure, FanMilk said it invested an additional GH¢47.19 million above the GH¢22.8 million in 2020 to acquire additional intangible assets and property, plant and equipment to support its operations.

It said the expenditure included spending to relocate the head office to the factory site at North Industrial Area in Accra.


More than 62 per cent of the company is owned by FanMilk International, leaving the rest to institutional and individual investors in and outside Ghana.