Cadbury Nigeria has reported a 10% decline in full year revenues for the period ended December 2020, to N35.4bn ($86.5m). Profits fell by 83% to N172.7m ($0.4m). The company has blamed the decrease on the COVID-19 pandemic.
Cadbury Nigeria, which is majority-owned by Mondelez International, is the manufacturer of the popular Bournvita malted drink. The company also markets the Cadbury chocolate brand, Clorets gum and the Buttermint and Tom Tom sugar confectionery brands.
The company is blaming the COVID-19 pandemic for hitting trading volumes. It says that the pandemic impacted the trade channel and both domestic and export sales in 2020.
Certainly, the COVID-19 pandemic has hit manufacturers of snacks and impulse products hard as lockdowns, curfews and reduced travelling by consumers meant that sales volumes suffered. It is less clear how the pandemic affected Cadbury Nigeria’s main brand, its Bournvita malted drink (which is typically consumed at home).
In India, Bournvita’s other major market, Cadbury introduced small sachet costing R5 ($0.07) in August 2020 to provide an affordable treat for families feeling a budget squeeze. A sachet of Bournvita in Nigeria costs N50 ($0.08) – almost the same price but the format is much less popular than the 500g jar.
In India, Bournvita is also present in biscuits and, as of August 2020, in cereals with its new Bournvita Fills variant. By contrast in Nigeria Bournvita is still relatively expensive and has not entered other product groups. Particularly for biscuits, a popular snack in Nigeria and one which Cadbury Nigeria is well equipped to enter, this is a mystery. It points to a more systemic lack of innovation and strategic direction in the Nigerian business.