2016 HFMP Annual Report&Accounts

2016
Annual Report
& Accounts
RC 55495
2016
Annual Report RC 55495
& Accounts
CONTENTS
INTRODUCTION
Pages
a. Financial Highlights 3
b. Notice of Annual General Meeting 4
c. Corporate Profile 6-8
d. Directors and other Corporate Information 9-10
BUSINESS REVIEW
a. Chairman's Statement 13-16
b. The Board of Directors' Profile 17-20
c. Report of the Directors 21-30
FINANCIAL STATEMENTS
a. Report of the Audit Committee 43
b. Report of the Independent Auditors 44
c. Statement of Financial Position 45
d. Income Statement 46
e. Statement of Other Comprehensive Income 47
f. Statement of Changes in Equity 48
g. Statement of Cash Flows 49
h. Index to Notes to the Financial Statements 50
i. Notes to the Financial Statements 51-87
j. Value Added Statement 89
k. Five Year Financial Summary 90
SHAREHOLDERS' INFORMATION
a. List of Key Distributors 92-93
b. Unclaimed Dividends 94
c. Share Capital History 95
d. Proxy Form 96
e. Electronic Delivery Mandate Form 98
f. Notes
Honeywell Flour Mills Plc.

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RC 55495 2016
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INTRODUCTION
Financial Highlights 3
Notice of Annual General Meeting 4
Corporate Profile 6-8
Directors and other Corporate Information 9-10

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& Accounts INTRODUCTION
FINANCIAL HIGHLIGHTS FOR THE YEAR ENDED 31 MARCH, 2016
%
Increase/
2016 2015 (Decrease)
Results in thousands of Naira
Revenue 50,883,780 49,057,511 4
(Loss)/prot before taxation (2,869,342) 1,434,828 (300)
(Loss)/prot after taxation (3,023,852) 1,120,267 (370)
Total assets 76,046,576 67,943,444 12
Shareholders' fund 16,362,599 20,315,834 (19)
Total liabilities 59,683,977 47,627,610 25
Issued and fully paid share capital 3,965,099 3,965,099 -
Market Capitalisation at 31 March 11,578,089 23,790,593 (51)
Per 50k share data

kobo kobo kobo
Earnings (38.13) 14.13 (52)
Proposed Dividend - 5.00 (5)
Net assets 206.33 256.18 (50)
Stock Exchange Information
Stock Exchange quotation at

31 March (in millions of Naira) 1.46 3.00 (1.54)
Number of Shares Issued (in millions) 7,930 7,930 -

Market Capitalisation as at
31 March (in millions of Naira) 11,578 23,791 (51.33)

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Notice of Annual General Meeting
NOTICE IS HEREBY GIVEN that the Seventh Annual General Meeting of Honeywell Flour Mills
Plc will hold as follows:
Date: Tuesday 20 September, 2016
Venue: Civic Centre

Ozumba Mbadiwe Street
Victoria Island
Lagos.
Time: 11a.m
The following will be transacted at the meeting:
Ordinary Business
1 To receive the Audited Financial Statements for the year ended 31 March, 2016, together with the
Reports of the Directors, Independent Auditors and Audit Committee thereon.
2 To elect Directors.
3 To authorise the Directors to x the Auditors remuneration.
4 To elect members of the Audit Committee.
Proxy
Any member of the company entitled to attend and vote at this meeting is also entitled to appoint a proxy to
attend and vote in his/her stead. A proxy need not be a member of the company. A proxy form is enclosed
herewith. A proxy form must be completed and deposited at the ofce of the Company's Registrar, First
Registrars and Investor Services Limited, 2 Abebe Village Road, Iganmu Lagos not later than 48 hours
before the time xed for the meeting.
Audit Committee
Any shareholder may nominate another shareholder as a member of the Audit Committee by giving notice
in writing of such nomination to the Secretary of the Company at least 21 days before the Annual General
Meeting.
Right of Shareholders to Ask Questions

Pursuant to Rule 19.12 (c) of the Nigerian Stock Exchanges Rulebook 2015, please note that it is the right
of every shareholder to ask questions not only at the meeting but also in writing prior to the meeting. We urge
that such questions be submitted to the Company Secretariat not later than two weeks before the date of the
meeting.
BY ORDER OF THE BOARD
Oluwayemisi Busari (Mrs.)

Company Secretary
FRC/2013/NBA/00000004046
4 Honeywell Flour Mills Plc.

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CORPORATE PROFILE
COMPANY HISTORY
H
oneywell Flour Mills Plc is a leading and highly successful indigenous Company in Nigeria with
a mission to use enterprise to make our world better. To achieve this, the Company has
positioned itself to lead its market in the production, distribution, sales and marketing of superior
quality products.
The Company started as Gateway Honeywell Flour Mills Limited on June 21, 1983 and was incorporated for
the production of flour and livestock feeds from wheat, sorghum, maize and millet. A change in the
Company's ownership structure led to a change in name to Honeywell Flour Mills Limited in June 1995.
Following a successful IPO and subsequent listing on the Nigerian Stock Exchange in 2009, the Company
became a publicly quoted Company as Honeywell Flour Mills Plc.
In April 1993, the Company entered into a contract-milling arrangement with a Flour Mill in Ibadan to
produce wheat flour under the brand name of Honeywell Superfine Flour. The brand immediately gained
wide acceptability in the flour market. The construction and installation of a 200-metric tonne wheat Mill
commenced in 1995 at the Tin Can Island site, Apapa, Lagos.
Following the successful completion of the 200-metric tonne per day Mill, commercial production and sale
of Honeywell Superfine Flour commenced on July 13, 1998. The growing demand for the product made it
expedient for the Company to plan for the expansion of its production capacity. Thus, in 1999, the Company
embarked on a re-modeling of its wheat Mill to a 360-tonne per day Mill. This project was satisfactorily
completed in May 2000. The installation and commissioning in November 2001 of a 250-metric tonne per
day Mill increased the Company's installed capacity to 610 metric tonnes per day
To remain a relevant and significant player in the flour milling industry, the Company took a giant leap with
the installation of two 500-metric tonne per day Mills that were brought into production in July 2005. This
additional capacity brought the total installed capacity of the Company to 1,610 metric tonnes per day. The
Company also launched its brand of Semolina, Honeywell Semolina in June 2006, which has been a huge
success since its introduction into the market, and is today adjudged by consumers as the leading Semolina
brand.
To further maximize its value chain, the Company launched its own brand of noodles in 2006 (initially as O!
Noodles and later re-launched with better quality seasoning and packaging as Honeywell Noodles).
Honeywell Pasta (Spaghetti and Macaroni) and Honeywell Wheat Meal were all launched in 2009. All the
brands have been well accepted by consumers and have grown rapidly.
The addition of another state-of-the-art twin Mills of 500-metric tonnes per day each in 2012 took the
capacity to 2,610 metric-tonnes per day. This latest expansion project is about 1,200% overall increase in

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CORPORATE PROFILE
capacity since the commencement of business. Future capacity expansion has been planned for the
Company's new Sagamu project (which is on a 63 hectare land space at the Sagamu interchange along the
Lagos-Ibadan expressway).
The Company's goal is to support women (who are its major targets) to provide nourishing meals for their
families with its consumer goods and bakers with its industrial product (flour). The Company continues to
invest in new product research and development to enable her produce more varieties of food products for its
teeming consumers. Future expansion projects will focus on pasta, noodles and animal feed production. New
products will be introduced to meet consumer demands as we make efforts to realise our corporate goals and
objectives.
OUR CORE VALUES

Responsibility
Integrity
Courage
Excellence
Respect
QUALITY POLICY
The Company is committed to the continuous achievement of business successes by maintaining its quality
leadership in Nigerias flour milling industry. This is driven by a quality management system designed to
ensure that customers are always provided with quality products and services, that meet internal standards
set for the purpose. Such standards are in full compliance with all statutory and regulatory requirements, and
are set out in writing for adherence by all staff at all times.
Honeywell Flour Mills Plc was the first flour milling company in Nigeria to be ISO-certified. All processes
and procedures across the organisation are in line with international best practices to ensure that it
continuously produces good quality products for the complete satisfaction of its highly esteemed customers.
The Company employs state-of-the-art facilities for the production of its various brands in conjunction with
its technical partners Buhler AG of Switzerland (the worlds leading milling equipment manufacturer) for
the installation and maintenance of its mills as well as a partnership agreement with Muhlenchemie of
Germany for the supply of additives.
PRODUCTS
Honeywell Flour Mills produces a wide range of superior quality products for the complete satisfaction of its
highly esteemed customers/consumers.
These products include:

Flour (Honeywell Superfine Flour, Honeywell Brown Flour and Honeywell Composite Flour): used
mainly for baking. The Flour brand was launched in July 1998 and has since carved a niche for itself through

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CORPORATE PROFILE INTRODUCTION
consistent superior quality improvement. The company provides efficient customer service, excellent
training and support for bakers across Nigeria.
Honeywell Semolina: This is a wheat-based ball food that is easy to prepare, smooth to eat and enjoyed with
any kind of soup. The brand has set new quality standards for semolina, which it has maintained since its
introduction and this is evident in its continued increased demand and preference by consumers. The brand
packaging is distinct and stands out on the shelf.
Honeywell Wheat Meal: This was launched into the market in 2009. At that time, this category was largely
underdeveloped and unpopular. The company has continued to invest in heavy marketing and sales support
to develop and grow this category and to make it acceptable to all consumer segments. The brand goes well
with any soup, is easy to prepare, hygienically packed and a healthier way to enjoy ball food. It is good for
everyone irrespective of social status. The brand packaging is distinct and stands out on the shelf.
Honeywell Pasta: made from the finest quality wheat semolina. The brand is well accepted by consumers
for its excellent quality and it comes in very attractive packaging which stands it out on the shelf.
Honeywell Noodles: This is made from fine quality flour and comes in three different variants; Chicken,
Spicy Chicken and Onion Chicken. Honeywell Noodles are a consumer delight. The brand packaging is
distinct and stands out on the shelf.
In line with NAFDAC and SON requirements, all our brands are fortified with vitamin A and other essential
minerals that are good for the body.
All our brands are rated among the top three in their different categories with respect to market share, top-of-
mind awareness and consumer usage.
CORPORATE SOCIAL RESPONSIBILITY

Honeywell Flour Mills Plc is a socially responsible Company. It engages in projects that aim at alleviating
poverty, aiding learning and helping the less privileged. The Company is also the only Flour Milling
Company in Nigeria that provides formal training for bakers. Most bakers in Nigeria have not had any formal
training in baking as the skill is acquired more through the apprenticeship model. However, the Company has
since set up a training school for bakers in furtherance of its belief that baking is both a science and an art that
cannot be fully mastered through apprenticeship alone but through some formal training.

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DIRECTORS AND OTHER CORPORATE INFORMATION
Board of Directors
Dr. Oba Otudeko, D.Sc. (Hon) CFR - Chairman
Mr. Olanrewaju Bamidele Jaiyeola - Managing Director
Lt. General Garba Duba (Rtd)
Mr. Obafemi Otudeko
Mr. Akinsoji Akintayo
Mr. Theophilus Oluranti Sokunbi
Dr. Nino Albert Ozara - Executive Director
Mr. Rotimi Gbenga D. Fadipe - Executive Director
Mr. Benson Osaretin Evbuomwan - Executive Director
Mrs. Oluseye Sandey - Executive Director (with effect from 15 December, 2015)
Mr. Alan Palmer (British)
Dr. Teddy Ngu (Cameroonian)
Mr. Andrew Smith-Maxwell (British)
Mrs. Wonuola Adetayo
Dr. Raymond Zoukpo (Ivorian)
Secretary
Mrs. Oluwayemisi Busari
Tel: +234 1 731 5870, +234 1 793 2694
Operational Offices
(a) Apapa Factory
2nd Gate By-Pass
Tin Can Island Port
Apapa, Lagos.
Website: www.honeywellflour.com
Email: hfml@honeywellflour.com
(b) Ikeja Factory

Plot YABB, Mobolaji Johnson Avenue
Alausa, Ikeja, Lagos.

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Registrars
First Registrars and Investor Services Limited
2, Abebe Village Road,
Iganmu, Lagos.
Registered Office
SW8/1185 Sanda Street
Molete, Ibadan,
Oyo.
Bankers
Access Bank Plc
Diamond Bank Plc
Ecobank Nigeria Plc
Fidelity Bank Plc
First Bank of Nigeria Limited
Guaranty Trust Bank Plc
Keystone Bank Limited
Skye Bank Plc
Stanbic IBTC Bank Plc
Standard Chartered Bank Nigeria Limited
Union Bank of Nigeria Plc
United Bank for Africa Plc
Zenith Bank Plc
Independent Auditors
BBC PROFESSIONALS
(Chartered Accountants)
24, Ilupeju By-Pass
Ilupeju,
Lagos.

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BUSINESS
REVIEW
CHAIRMANS STATEMENT 13-16
BOARD OF DIRECTORS PROFILE 17-20
THE REPORT OF THE DIRECTORS 21-30

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BUSINESS REVIEW CHAIRMANS STATEMENT
D ear shareholders,
distinguished ladies and
gentlemen, I welcome you
th
all to the 7 Annual General Meeting
(AGM) of our dear Company,
On behalf of the Board of Directors, I
present to you the Annual Report and
Financial Statements of your
company for the nancial year ended
31st March, 2016.
As usual, these results are presented
against the backdrop of the political,
economic and business environments
that we operated in at both global and
local levels.
Dr. Oba Otudeko, CFR

Chairman

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BUSINESS REVIEW CHAIRMANS STATEMENT contd

GLOBAL ECONOMIC ENVIRONMENT like ours.
Throughout 2015, global economic activity The fall in crude oil prices consequently led to a
remained subdued, with slow growth rates even shortage of foreign exchange for the Nigerian
in hitherto fast growing Emerging Markets. The Government and although the ofcial Central
International Monetary Fund (IMF) had Bank of Nigeria (CBN)/Interbank exchange rate
estimated global growth rate at 3.1%, much remained at N197-N199/US$, the apex bank was
slower than the growth rate of 3.4% recorded in unable to meet demands and so began rationing
2014. supply to corporate organisations and
This pattern of global growth has been irregular individuals by mid 2015. This led to a widening
but in a declining trend for the fth consecutive gap between the ofcial and parallel market rates
year. Three key trends have most inuenced the with the latter hitting N340/US$ by the end of
global economic outlook. Firstly, the sharp March 2016.
decline in the price of crude oil and other Most users of forex had to turn to the parallel
commodities; oil prices fell by over 50%, to market for supply, leading to a situation where
under $30 per barrel before rebounding to now manufacturers and importers of goods had to
hover around $50 per barrel. Secondly, the increasingly price their products against parallel
continuing slowdown and rebalancing of market rates.
economic activities in China away from These series of negative factors led to increased
investment in manufacturing towards uncertainty, rising cost pressures and mounting
consumption and services; and lastly, the job losses in the Nigerian economy. According to
measured tightening of monetary policy in the the National Bureau of Statistics (NBS), the
United States and Europe. national ination rate rose to 11.8% in March
According to the IMF, 2016 commenced on a 2016 which, at that time, was the highest
bright note with global output performing better ination rate since December of 2012. At the
than expected in the rst half of the year, time of writing this report, this has risen further
however the outlook for the second half of the to 16.5%.
year is dampening, following the unexpected Money supply was further tightened in March
exit vote of the United Kingdom from the 2016 when the CBN raised the Monetary Policy
European Union (EU). This impending pull out Rate (MPR) by 100 basis points to 12% from
from the EU economic bloc has negatively 11%. Cash Reserve Ratio (CRR) on private
affected investor condence and contributed to a funds held by the banks was also adjusted to
perception of increases in risk and uncertainty 22.5% from 20%, effectively mopping up
across global markets. liquidity in the nancial system.
It is against this backdrop that your Company
NIGERIA ECONOMIC ENVIRONMENT operated in the last nancial year.
Unpredictability is a major disincentive to
investment and is the one factor that most OPERATING ENVIRONMENT
businesses seek to avoid or mitigate. Over the Consumer spending progressively dropped
last year, the economic environment in Nigeria throughout the operating period under review.
has been volatile and at a macro-level, most Prices of most consumer goods rose sharply in
indices have trended in the negative direction. response to higher input and transportation costs.
The Nigerian economy grew at a rate of only This translated into intense price competition
2.84% in 2015, well below the earlier growth within the our milling industry as players
forecast of 5.54%. Specically, growth slowed in sought to retain market share in the midst of
the last two quarters of 2015 and was closely reduction in demands.
linked to the sharp decline in crude oil prices HFMP was unable to achieve full capacity
which badly affected oil dependent economies utilization due to several challenges such as the

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debilitating Apapa trafc gridlock in the rst half locally, to meet some of our requirements and
of the year, and then an acute shortage of foreign reduce the huge import burden of sourcing for
exchange which severely affected our ability to limited available foreign exchange.
maintain a steady supply of wheat and other raw We also commenced several projects to optimize
materials. Lately, the erratic supply of gas and our cost and entrench continuous improvement
increased diesel prices has added further and innovation across the business, especially in
pressure to our business. On a positive note the our manufacturing and supply chain operations.
cost of wheat from world markets reduced Human Capital
steadily in Dollar terms during the year but the
supply of locally available raw materials came at We continued to strengthen our talent pipeline
constantly higher costs. and enhance the capacity of our personnel
through various talent management programmes
Investment in Sales and Retail Distribution and the development of a world-class
After an in depth strategic review and in the face organizational structure.
of all these constraints, we embarked on a Towards achieving this, some senior positions
number of strategic initiatives to drive top line were lled through external appointments. A
growth and contain costs. To drive sales, we took new National Sales Manager was recruited to
a novel approach to our Go-to-Market strategy head our Business-to-Consumer team.
by splitting our sales organisation into two Recruitment into other identied roles in the
distinct teams: Business-to-Consumer (B2C) newly restructured Sales Organization will be
and Business-to-Business (B2B). The new B2C completed within the new nancial year. A new
Team focuses on selling our Semolina, Whole Consumer Marketing Manager was also
Wheat Meal, Spaghetti, Macaroni and Instant recruited to handle our B2C brands while a
Noodles brands while the B2B Team focuses on new Senior Manager, Continuous Improvement
selling our bread and pastry our brands to key also joined the business to improve efciencies
distributors and large corporate bakers and in all aspects of our manufacturing and
confectioneries. operational activities ahead of the Company's
We also made further investments in deepening anticipated growth and future expansion.
our retail strategy and getting closer to the nal
consumers of our brands. We deliberately
fostered closer relationships with our key RESULTS FOR THE YEAR
distributors and the fast increasing modern trade Our revenue grew by 4% to N50.88 billion.
outlets in Nigeria and also ran regular consumer However, the combined effects of lower
promotions to build loyalty. To penetrate further disposable income of our consumers and
into the last mile of retail, we increased our eet progressive devaluation of the Naira induced a
of redistribution vans to distribute our products signicant foreign exchange loss which
to more supermarkets, grocery stores and impacted on cost of sales and consequently
neighbourhood convenience stores to ensure that eroded prots. As a result, the Company
our brands were fully available at all consumer recorded a loss for the rst time in its 20-year
points of purchase. history, amounting to N2.87 billion before taxes.
Cost Control Dear shareholders, the Board and Management
We embarked on several strategic projects to Team of the Company are determined to do our
reduce our costs. One of the most important steps best to prevent a reoccurrence of this
we took was to begin the process of developing unanticipated dip in our bottom-line numbers
local sources for our key raw material, wheat. To and steer the Company back to protability.
this end, we led other stakeholders in the Flour Total Assets rose by 12% from 67.94 billion
Millers Association of Nigeria to partner with the reported in 2015 to 76.05 billion as at 31st
Federal Ministry of Agriculture, Wheat Farmers March, 2016. Asset growth in the review period
Association of Nigeria and the Lake Chad Basin was largely driven by our on-going capacity
Research Institute in the farming of wheat, expansion projects.

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OUTLOOK Mrs. Sandey brings over 30 years of corporate
The 2016 macro-economic forecast for Nigeria experience, most of it in consumer goods to the
carries a pessimistic and uncertain outlook, with table. We are condent that her experience will
the IMF projecting negative real GDP growth of further enhance the Boards' ability to lead the
(1.8%) and having already entered a recession Company and guide the Management team in the
following two quarters of negative growth by the achievement of the Company's vision to become
rst half of 2016. However, we are focused on Africa's foremost food company with a portfolio
implementing strategies that will help us remain of leading brands preferred by consumers.
on the growth path and a return to protability.
Completion of New Pasta Plant RETIREMENT BY ROTATION
By the end of the current nancial year, we In line with the Company's Articles of
expect to complete the development of our state- Association, the following Directors namely Mr.
of-the-art pasta factory at the Honeywell Foods Obafemi Otudeko, Mr. Olanrewaju Jaiyeola, Mr.
and Agro-allied Complex in Sagamu, Ogun Benson Evbuomwan, Mr. Rotimi Fadipe and Mr.
State. This new factory will increase our pasta Akinsoji Akintayo retire by rotation at this
production capacity by over 100% and is Annual General Meeting and being eligible,
versatile enough to produce innovative pasta offer themselves for re-election.
types for the delight of our consumers.
Backward Integration APPRECIATION
We are working with local and international Distinguished Shareholders, I cannot conclude
agricultural development organisations without reiterating, on behalf of the Board, our
including FIIRO (Federal Institute of Industrial profound appreciation for your unwavering
Research, Oshodi), ICRISAT (International support even at this very difcult time. Your
Crop Research Institute for Semi-Arid Tropics), continued condence in the ability of the Board,
GAIN (Global Alliance for Improved Nutrition), Management and the entire members of staff to
Oxfam and USAID MARKETS (United States propel your Company to the path of sustainable
Agency for International Development) to protability will continue to drive us towards
develop out-grower schemes with local farmers delivering superior performance in the future.
in Nigeria to explore the use of local grains in I would also like to thank our Consumers,
our production. We are committed to ensuring Distributors, Suppliers, Staff and other
that we produce affordable and nutritious foods stakeholders for their unalloyed support,
for Nigerians and to increase raw material collaboration and partnership.
purchases from sustainable local sources.
Once again I thank you all for your attendance
and look forward to your active participation and
BOARD APPOINTMENTS valuable contributions, as usual, to the activities
I am pleased to announce the appointment of of the day.
Mrs. Oluseye Efunyemi Sandey to the Board of
Directors of our Company. Thank you and God bless you all.
Mrs. Oluseye Sandey joined Honeywell Flour
Mills Plc. as Finance & IT Director in September
2015. Her core strengths are in the areas of
nance, accounting, planning, budgeting and
reporting, taxation, organisation design and Dr. Oba Otudeko CFR
process optimization and risk compliance. Chairman of the Board

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& Accounts DIRECTORS contd
Dr. Oba Otudeko, D.SC. (Hon.) CFR Mr. Olanrewaju Jaiyeola

Chairman Managing Director
Lt. General Garba Duba (Rtd.) Mr. Alan Palmer Mr. Obafemi Otudeko
Non-Executive Director Non-Executive Director Non-Executive Director
Dr. Nino Albert Ozara Dr. Teddy Ngu

Executive Director, Manufacturing Non-Executive Director

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& Accounts DIRECTORS contd
Mr. Akinsoji Akintayo Mr. Theophilus Oluranti Sokunbi Mrs. Wonuola Adetayo
Non-Executive Director Non-Executive Director Non-Executive Director
Mr. Benson Evbuomwan Dr. Raymond Zoukpo

Mr. Rotimi Gbenga Fadipe Executive Director, Marketing Non-Executive Director
Executive Director, Supply Chain
Mr. Andrew Smith-Maxwell Mrs. Oluseye Sandey

Non-Executive Director Executive Director, Finance & IT

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BOARD of
DIRECTORS contd
He was formerly the Commercial Director at the

Companys Ikeja Factory. He has been in the service of
the Company for over 20 years. His career and business
management experience in the Company spans nance,
sales management and manufacturing management.
Mr. Alan Palmer
Dr. Nino Albert Ozara joined Honeywell Flour

Mills Plc in 1998 from Federal University of
Technology, Owerri where he had risen to the
position of Head of Crop Production Department.
He holds a First Class Degree in Soil Science from
the University of Ibadan, and a Doctorate Degree
also in Soil Science from the Craneld Institute of
Technology, United Kingdom. He subsequently
had his professional our milling training at the
Swiss Milling School, St. Gallen, Switzerland and
the Buhler Training Centre Uzwil also in
Switzerland.
He currently serves as Executive Director,

Manufacturing.
He is also a Director of First Bank of Nigeria Limited and

was formally the Second Vice President of the Nigerian
Gas Association.
Dr. Teddy Ngu

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BOARD of
DIRECTORS contd
Wonuola Adetayo (Mrs)
A graduate of Chemistry from the University of Ibadan,

Nigeria, he obtained a Post Graduate Certicate in
Management (PGCM) from University of Derby, U.K.
2000. He has attended several other management courses
both locally and internationally some of which include
Senior Management Development programmes at
Ashridge Management College and Total Quality
management Courses from the Lagos Business School.
Dr. Raymond Zoukpo Andrew Smith-Maxwell
Benson holds a Bachelors degree in Pharmacy from

University of Benin and is a member of the Advertising
Practitioners Council of Nigeria (APCON).
Mrs Oluseye Sandey

Executive Director, Finance & IT
Mrs. Oluseye Sandey holds a Bsc. Degree from Aston University, UK
and MBA from Heriot-Watt University, Edinburgh, UK. She is a Fellow
of the Institute of Chartered Accountants of Nigeria.
She started her career in 1988 with Akintola Williams Deloitte & Co. In
June 1994, she joined Coca-Cola Nigeria Limited a fully owned
subsidiary of The Coca-Cola Company as Budget Manager and rose to
become the Finance Operations Director for Africa responsible for
providing Financial Services to all Coca-Cola Business Units in Africa,
Middle East and Pakistan. She held this position until August 2014 when
she returned to Nigeria after 20 years of service with Coca-Cola.
She brings to the Board over 30 years of experience in auditing,

budgeting and reporting, business development and taxation. Her key
focus areas include Strategy, Organization Design and Process,
Planning, Business Partnership, Risk Compliance and People
Development. Prior to her appointment to the Board on December 15,
2015, Oluseye had joined Honeywell Flour Mills Plc as Finance & IT
Director in September 2015 and has responsibility for managing the
Finance and IT teams.

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& Accounts BUSINESS REVIEW
REPORT OF THE DIRECTORS FOR THE YEAR ENDED MARCH 31, 2016
The Directors have the pleasure in submitting to members their annual report together with the audited
nancial statements for the year ended 31 March, 2016.
PRINCIPAL ACTIVITIES
Honeywell Flour Mills Plc. (HFM Plc.) was initially registered as GATEWAY HONEYWELL FLOUR
MILLS LIMITED on 21 June, 1983. A change in the company's ownership structure led to a change of
the name to HONEYWELL FLOUR MILLS LIMITED in June 1995. The company was converted to a
Public Liability Company in 2008. Its shares were listed on the Nigerian Stock Exchange (NSE) in
2009.
The Company is principally involved in the manufacturing and marketing of wheat based products
such as our, semolina, whole wheat meal, noodles and pasta.
RESULTS FOR THE YEAR

2016 2015
In thousands of Naira
Revenue 50,883,780 49,057,511
(Loss)/Profit before taxation (2,869,342) 1,434,828
Taxation (154,510) (314,561)
(Loss)/Profit after taxation (3,023,852) 1,120,267
DIVIDEND
The Directors do not recommend the declaration of any dividend in view of the loss sustained during
the year.
PRODUCTS DISTRIBUTION
The Company's products are distributed through many distributors across the country.
CORPORATE GOVERNANCE
The company is committed to the best practices and procedures in Corporate Governance. Its business
is conducted in a fair, honest and transparent manner which conforms to the Code of Best Practices on
Corporate Governance in Nigeria. Examples of the Company's compliance with these Corporate
Governance requirements during the year under review are as follows:
i. Board Composition
The Board consists of a non-executive chairman, nine (9) non-executive Directors, and five (5)
executive Directors, all possessing high levels of competence and expertise. They are
professionals and entrepreneurs with vast business management experience and credible track
records. The non-executive directors are independent of the management and are free from
constraints which may materially affect their judgment as directors of the Company.
ii. Role of the Board

The Board has the responsibility of ensuring that the Company is properly managed and
achieves its strategic objectives with the aim of creating sustainable long term value to the
Shareholders.

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iii. Record of Directors Attendance at Meetings

Members of the Board of Directors hold periodic meetings to decide on policy matters with the aim of directing
the affairs of the Company, reviewing its operations and finances and formulating growth strategies for the
company. Board agenda and reports are provided ahead of meetings.
Further to the provision of Section 258(2) of the Companies and Allied Matters Act, CAP C20 LFN 2004, the
records of the Directors' attendance at Board meetings during the year under review are available at the Company's
Corporate Head office for inspection. In line with Corporate Governance principles, details of attendance of the
current Directors at the Board meetings during the year are as follows:
Names of Directors No. of No. of
Meetings held Meetings attended
Dr. Oba Otudeko, D.Sc. (Hon.) CFR 4 4
Mr. Obafemi Otudeko 4 4
Mr. Olanrewaju Jaiyeola 4 4
Dr. Nino Albert Ozara 4 3
Lt. General Garba Duba (rtd) 4 3
Mr. Akinsoji Akintayo 4 4
Mr. Theophilus Oluranti Sokunbi 4 4
Mr. Rotimi Gbenga Fadipe 4 3
Mr. Benson Evbuomwan 4 4
Mrs. Oluseye Efunyemi Sandey 4 2 (with effect from 15 December, 2015)
Mr. Alan Palmer 4 4
Dr. Teddy Ngu 4 4
Mr. Andrew Smith-Maxwell 4 4
Mrs. Wonuola Adetayo 4 4
Dr. Raymond Zoukpo 4 4
Board meetings were held on June 19, 2015, September 28, 2015, December 15, 2015 and March 8, 2016.
iv. Board Changes

Mrs Oluseye Sandey joined the Board on 15 December, 2015 as Executive Director, Finance & IT. She is seeking
ratication of her appointment to the Board at the 7th Annual General Meeting of the Company.
In line with the Companys Articles of Association, the following Directors namely, Mr. Obafemi Otudeko, Mr.
Olanrewaju Jaiyeola, Mr. Benson Evbuomwan, Mr. Rotimi Fadipe and Mr. Akinsoji Akintayo shall retire by
rotation at this Annual General Meeting and being eligible, offer themselves for re-election.
v. Committees
In conformity with the Code of Best Practice in Corporate Governance, the Company has in place the following
Committees:
a) Nominations Committee
The Nominations Committee is empowered to bring to the board recommendations regarding the appointment of
any Executive or Non-Executive Director. The Committee ensures that a review of Board candidates is undertaken
in a disciplined and objective manner. Details of attendance at the Nominations Committee meetings during the
year are as follows:
Names of Members No. of No. of
1. Dr. Oba Otudeko, D.Sc. (Hon.) CFR 2 2
2. Lt. Gen. Garba Duba 2 2
3. Mr. Obafemi Otudeko 2 2
Nominations Committee meetings were held on Tuesday 17 November, 2015 and Wednesday 2 December, 2015.

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b) Business Development Committee

The purpose of the Business Development Committee is to assist the Board in fulfilling its
responsibilities in relation to assessing and managing the Company's business development strategies
and activities. The Committee was formally inaugurated on 14 December, 2012. Details of attendance
at the Business Development Committee meeting during the year are as follows:
Names of Members No. of No. of

1. Mr. Alan Palmer (Chairman) 2 2
2. Mr. Olanrewaju Jaiyeola 2 2
3. Dr. Nino Ozara 2 1
4. Mr. Oluranti Sokunbi 2 2
5. Mr. Benson Evbuomwan 2 2
6. Mr. Rotimi Fadipe 2 2
7. Mrs. Wonuola Adetayo 2 2
8. Teddy Ngu 2 2
Business Development Committee meetings were held on May 26, 2015 and November 26, 2015.
vi. Management
The Executive Management comprises of the Executive Directors and Head of Departments of the
Core Business Units of the Company. It meets on regular basis and is responsible for setting overall
corporate targets, reviewing the Companys performance/operational issues and overseeing the affairs
of the Company on a day-to-day basis. As at 31 March 2016, the Executive Management comprised of
the following members:.
Mr. Olanrewaju Bamidele Jaiyeola - Managing Director

Dr. Albert Nino Ozara - Executive Director, Manufacturing
Mr. Rotimi Gbenga Fadipe - Executive Director, Supply Chain
Mr. Benson Evbuomwan - Executive Director, Marketing
Mrs. Oluseye Sandey - Executive Director, Finance & IT
Mr. Babatunde Adebayo - Human Resources Manager
Mr. Oluseye Ogunwole - National Sales Manager (B2B)
Mr. Narendra Nagarkar - National Sales Manager (B2C)
Mrs. Oluwayemisi Busari - Company Secretary

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vii. Directors Interest

The direct and indirect interests of Directors in the Issued Share Capital of the Company as recorded in
the Register of Directors Shareholdings and/or as notified by the Directors for the purposes of Sections
275 and 276 of the Companies and Allied Matters Act, CAP C20 LFN 2004 and the listing requirements
of the Nigerian Stock Exchange is stated hereunder:
At 31 March, 2016 At 19 June, 2015

Indirect Direct Indirect Direct
Unit Holdings Unit Holdings Unit Holdings Unit Holdings
Dr. Oba Otudeko, D.Sc. Hon. CFR* 1,247,264,003 - 1,247,264,003 -

Mr. Obafemi Otudeko* 567,951,925 - 567,951,925 -
Mr. Olanrewaju Bamidele Jaiyeola - 150,000 - 100,000
Dr. Nino Albert Ozara - 250,000 - 250,000
Lt. General Garba Duba (Rtd) - 4,554,030 - 4,554,030
Mr. Akinsoji Akintayo - 200,000 - 200,000
Mr. Oluranti Sokunbi - 208,000 - 208,000
Mr. Rotimi Gbenga Fadipe - 115,000 - 115,000
Mr. Benson Evbuomwan - 20,000 - 20,000
Mrs. Oluseye Sandey - 100,000 - -
Mr. Alan Palmer - 75,783 - -
Dr. Teddy Ngu - 100,000 - -
Mr. Andrew Smith-Maxwell - - - -
Mrs. Wonuola Adetayo - 50,000 - -
Dr. Raymond Zoukpo - - - -
* Dr. Oba Otudeko and Mr. Obafemi Otudeko have indirect holdings amounting to 1,247,264,003
and 567,951,925 respectively through Siloam Global Services Limited which is a 75% equity
holder in the Company.
viii. Directors Interest in Contracts

None of the Directors have notified the Company for the purpose of Section 277 of the Companies and
Allied Matters Act, CAP C20 LFN 2004 of any disclosable interest in contracts in which the Company
was involved during the year ended 31 March, 2016.
ix. Responsibilities of the Directors

In accordance with the provisions of Sections 334 and 335 of the Companies and Allied Matters Act,
CAP C20 LFN 2004 and Federal Reporting Council of Nigeria Act, 2011, the Directors of Honeywell
Flour Mills Plc are responsible for the preparation of the financial statements which give a true and fair
view of the state of affairs of the Company as at 31 March, 2016 and the results of its operations, cash
flows and changes in equity for the year ended, in compliance with International Financial Reporting
Standards (IFRS).

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The responsibilities include, ensuring that:

- appropriate internal controls are established to safeguard the assets of the Company and to
prevent and detect fraud and other irregularities;
- the Company keeps accounting records which disclose with reasonable accuracy the financial
position of the Company and ensure that the financial statements comply with the requirements
of the Companies and Allied Matters Act, CAP C20 LFN 2004;
- the Company has used appropriate accounting policies, consistently applied and supported
by reasonable and prudent judgments and estimates, and that all applicable accounting standards
have been followed; and
- the financial statements are prepared on a going concern basis unless it is presumed that the
Company will not continue in business.
The Directors accept responsibility for the annual financial statements, which have been prepared
using appropriate accounting policies supported by reasonable and prudent judgments and estimates, in
conformity with International Financial Reporting Standards (IFRS) and the requirements of the
Companies and Allied Matters Act, CAP C20 LFN 2004 and Financial Reporting Council of Nigeria
Act, No. 6, 2011.
The Directors are of the opinion that the financial statements give a true and fair view of the
state of the financial affairs of the Company and of the financial performance during the year.
The Directors further accept responsibility for the maintenance of accounting records that may be
relied upon in the preparation of the financial statements, as well as adequate systems of
internal control.
Nothing has come to the attention of the Directors to indicate that the company will not remain a going
concern for at least twelve months from the date of these financial statements.
x. Performance Evaluation of the Board

The Board has established a system to undertake a formal and rigorous evaluation of its own
performance, that of its Committees, the Chairman and individual Directors. The evaluation system
includes the criteria and key performance indicators and targets for the Board, its Committees and each
individual Committee member. The Board engages the services of external consultants to facilitate the
performance evaluation of the Board, its Committees and individual members.
EMPLOYMENT AND EMPLOYEES

Employment policy
It is the policy of the Company that there should be no discrimination in considering applications for
employment including those from physically challenged persons. However, there was no physically
challenged person in the employment of the company during the year.

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Training and development

It is the Company's policy to equip all employees with the skills and knowledge required for the
successful performance of their jobs. The Company sees the investment in its people as a major part of
its strategic development and has maintained a consistent policy of training its staff, both locally and
internationally to enhance their skills and competence.
Health and welfare of employees

The Company maintains a staff clinic with a full-time nurse and weekly attendance by a
physician. It also offers free medical services through a health management services provider to all
members of staff.
The Company continuously strives to improve its operations to ensure a safe working
environment. It also maintains a high standard of hygiene in all its premises through sanitation practices
and regular fumigation exercises, as well as installation of pest and rodent control gadgets.
Nutritionally balanced meals are provided in the Staff Canteen free for the Junior Staff and at highly
subsidized rate for the Senior Staff.
AUDIT COMMITTEE
In compliance with section 359 (4) of the Companies and Allied Matters Act CAP C20 Laws o f t h e
Federation of Nigeria 2004, members of the Audit Committee were elected at the Annual General
Meeting held on 24 September, 2015.
Members that served on the Committee during the year comprise:
Mr. Adebayo Adeleke Shareholder

Alhaji Lateef Ayodeji Shonubi Shareholder
Mr. Gabriel Olagunju Shareholder (Up to June, 2015)
Dr. Tunji Odebunmi Shareholder (with effect from 24 September, 2015)
Lt. Gen. Garba Duba (Rtd) Director
Mr. Akinsoji Akintayo Director
Mr. Andrew Smith-Maxwell Director
The Committee in the conduct of its affairs reviews the Companys overall risk management and
control systems, financial reporting arrangements and standard of business conduct. Members of the
Audit Committee have direct access to the Internal Audit Department and Independent Auditors.
The statutory functions of the Committee are provided for in section 359(6) of the Companies and
Allied Matters Act, Cap.C20, Laws of the Federation of Nigeria, 2004.The details of attendance at
meetings of the Committee during the year are as follows:

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No. of No. of
Mr. Adebayo Adeleke 4 4
Alhaji Lateef Ayodeji Shonubi 4 4
Mr. Gabriel Olagunju 4 - (Up to June, 2015)
Dr. Tunji Odebunmi 4 2 (with effect from 24 September, 2015)
Lt. Gen. Garba Duba (Rtd) 4 2
Mr. Akinsoji Akintayo 4 4
Mr. Andrew Smith-Maxwell 4 4
The Audit Committee meetings were held on June 18, 2015, September 21, 2015, December 14, 2015
and March 10, 2016.
SECURITY TRADING POLICY

In line with Section 14 of the Amendment to the Listing Rules of the Nigerian Stock Exchange,
Honeywell Flour Mills Plc has in place a Security Trading Policy.
During the financial year under review, the Directors and employees of the Company complied with the
Nigerian Stock Exchange Rules relating to securities transactions and the provisions of the Honeywell
Flour Mills Plc Policy on insider trading.
COMPLAINTS MANAGEMENT POLICY

Honeywell Flour Mills Plc has in place a Complaints Management Policy in compliance with the
Investments and Securities Act (ISA) 2007 and in line with the Securities and Exchange Commission
Rules relating to the Complaints Management Framework of the Nigerian Capital Market.
During the financial year, all enquiries and complaints covered under the Policy were promptly
resolved.
WHISTLE BLOWING POLICY

Under its whistle blowing mechanism, employees of Honeywell Flour Mills Plc and other stakeholders
including third parties are encouraged to report anonymously or otherwise, any observed or suspected
acts of fraud, corruption or other irregularities, via independent helplines by telephone or online
without fear of reprisal or recrimination.
The Company guarantees that the identity of the reporting individual or organisation is accorded utmost
protection and the report timeously investigated and treated.
This robust system has been embraced by all employees and stakeholders and it is producing good
results.
QUALITY POLICY
The Company is committed to the continuos achievement of business success by maintaining its quality
leadership in Nigerias flour milling industry.
This is driven by a quality management system designed to ensure that customers are always provided
with high quality products and services that meet International Standards. Such standards are in full
compliance with all statutory and regulatory requirements and are set out in writing for adherence by all
staff at all times.

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SHAREHOLDING ANALYSIS
The shareholding structure of the company as at 31 March, 2016 is as stated below:
Share range No % No %
of holders of holders of holdings of holdings
1 - 1,000 10,793 34.75 10,054,477 0.13
1,001 - 5,000 13,574 43.70 35,884,503 0.45
5,001 - 10,000 2,863 9.23 23,610,919 0.30
10,001 - 50,000 2,607 8.39 61,037,716 0.77
50,001 - 100,000 548 1.76 42,828,587 0.53
100,001 - 500,000 526 1.69 109,742,463 1.38
500,001 - 1,000,000 75 0.24 56,819,101 0.72
1,000,001- 5,000,000 50 0.16 93,359,271 1.18
5,000,001- Above 23 0.08 7,496,860,621 94.54
31,059 100.00 7,930,197,658 100.00
SUBSTANTIAL INTEREST IN SHARES

According to the register of members, the following shareholders of the Company held more than 5
percent of the Issued Share Capital of the Company at 31 March, 2016:
2 0 16
Number %
Siloam Global Services Limited 5,921,363,565 75
First Bank of Nigeria Limited 400,967,024 5

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DONATIONS AND SPONSORSHIP

The following donations and charitable gifts were made during the year:
N
Lekki Conservative Centre 203,279
Odogbolu Community and Education Development 144,500
Youth Alive Community Basketball Camp 1,169,000
SOS Children Village Nigeria 150,000
Little Saints Orphanage Homes 150,000
Compassionate Orphanage Homes 100,000
Bethesda Orphanage Homes 100,000
Oyo State Economic Summit 1,000,000
Red Cross Annual Youth Leadership Training Camp 100,000
Vision Of The Child (VOTC) Project 740,000
Childrens Day Programme 1,198,688
Down Syndrome Homes 100,000
Health Work Initiative 150,000
NYSC Programmes 4,772,685
Lagos State Park Childrens Day Carnival 144,491
Fiesta of Flavour for Children 1,000,000
Trade Fair Kiddies Arena 342,922
Student Fortress Conference 142,209
11,707,774

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PROPERTY, PLANT AND EQUIPMENT

Movements in Property, Plant and Equipment during the year are shown in note 5 on page 68. In the
opinion of the Directors, the market value of the Company's properties are not lower than the value
shown in the financial statements.
POST BALANCE SHEET EVENT

There are no post-balance sheet events which could have had material effect on the financial position of
the Company as at 31 March, 2016 and loss attributable to equity holders on that date.
INDEPENDENT AUDITORS
In accordance with section 357 (2) of the Companies and Allied Matters Act, CAP C20 LFN 2004,
Messrs BBC Professionals [Chartered Accountants] have expressed their willingness to continue in
office as Independent Auditors to the Company. A resolution will be passed at the Annual General
Meeting to authorize the Directors to fix the remuneration of the auditors.
Dated 20 June, 2016
By Order of the Board
Oluwayemisi Busari (Mrs.)

Company Secretary
FRC/2013/NBA/00000004046

30
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...more than just a meal!
RC 55495
2016
Annual Report
& Accounts CORPORATE SOCIAL RESPONSIBILITY
HONEYWELL PARTNERS VISION OF THE CHILD
Executive Director, Marketing, HFMP,

Mr Benson Evbuomwan congratulates
one of the Literary Award Winners.
L-R Executive Governor of Lagos

State, Mr Akinwumi Ambode, Deputy
Governor of Lagos State, Mrs Oluranti
Adebule, Executive Director, Logistics
& Supply, HFMP, Mr Rotimi Fadipe.
L-R Executive Governor of Lagos State,

Mr Akinwumi Ambode, Executive
Director, Marketing, HFMP, Mr Benson
Evbuomwan, Executive Director,
Logistics & Supply, HFMP, Deputy
Governor of Lagos State, Mrs Oluranti
Adebule, presenting a cheque to the 2nd
place winner.
Grand prize winner of Honeywells Sisi

Eko Kitchen Competition receiving the
cash award.
L-R Erelu of Lagos, Princess Abiola

D o s u n m u , E x e c u t i v e D i r e c t o r,
M a r k e t i n g , H F M P, M r B e n s o n
Evbuomwan, Executive Director,
Logistics & Supply, HFMP, Mr Rotimi
Fadipe.

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HONEYWELL VISITS SCHOOLS FOR THE BLIND (BETHSEDA & PACELLI)
(L-R) Executive Director, Marketing, Honeywell Flour Mills Plc, Mr Benson Evbuomwan
presenting Honeywell products to representatives of the school. Trade and Marketing Manager,
HFMP, Mr Dayo Adeniyi; Consumer Marketing Manager, HFMP, Mrs Esther Tontoye.
(L-R) Consumer Insight Manager, HFMP, Mr Lanre Da

Silva presenting company's products to Pacelli ofcials
along with Manager, Corporate Marketing, HFMP, Mrs
Ebele Oluwalana.
The school's ofcials expressing their gratitude.

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HONEYWELL BAKING SCHOOL GRADUATION CEREMONY
Baking School Facilitator, Mr Brega

Fabusuyi (Center) in a group photograph
with graduating students.
One of the graduating students presenting the varieties

of pastries made from Honeywell Superfine Flour to
Executive Director, Supply Chain HFMP, Mr Rotimi
Fadipe and Managing Director, HFMP, Mr Lanre
Jaiyeola.
The 2nd best graduating student, Mr Orukotan Jeremiah

receiving an award from the Executive Director, Supply
Chain, HFMP, Mr Rotimi Fadipe.

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HONEYWELL/FRSC SAFETY AWARENESS CAMPAIGN
(L-R) 2nd left Ojota sector

commandant, Mr GK Hamzat;
Executive Director Marketing, HFMP,
Mr Benson Evbuomwan, in a group
photograph with other HFMP and FRSC
ofcials.
Executive Director Marketing,

HFMP, Mr Benson Evbuomwan,
reaching out to motorists with
educative iers.
An ofcial of the FRSC addressing all attendees

at the event.

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HONEYWELL VISITS ORPHANAGES ( LITTLE SAINTS, LAGOS STATE & SOS, IJEBU OWU, OGUN STATE)
Executive Director Marketing, HFMP, Mr Benson

Evbuomwan making a presentation of Honeywell
products to the founder of Little Saints Orphanage, Mrs
Dele George.
(L-R) Trade Marketing & Sustainability

Manager, HFMP, Mr Dayo Adeniyi; The
founder Little Saints Orphanage, Mrs Dele
George; Executive Director, Marketing,
HFMP, Mr Benson Evbuomwan; Consumer
marketing Manager, Mrs Esther Tontoye.
(L-R) Assistant
M a n a g e r, M e d i a &
Communications,
H F M P, M r G b e n g a
Akindele, Mrs Bola
Ogunyinka, Brand
Manager, Ball Foods,
Mr Inusa-Ahmad
Anthony, Family Based
Care Co-ordinator and a
staff of SOS orphanage,
Ijebu Owu, Ogun State.

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HONEYWELL SUPPORTS YOUTH ALIVE BASKETBALL TOURNAMENT.
Managing Director, Honeywell

Flour Mills (HFMP) Plc, Mr
Lanre Jaiyeola kicks off the
competition in the presence of
other HFMP ofcials and Event
organizers.
Managing Director, Honeywell Flour Mills (HFMP) Plc, Mr Lanre

Jaiyeola making a presentation to the winning team.

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HONEYWELL DONATES TO NIGERIAN ARMY
(L-R) Executive Director, Marketing, HFMP, Mr

Benson Evbuomwan and Director of Finance and
IT, Mrs Oluseye Sandey making a donation to the
Nigerian Army. Lt. Col Jocka of the Nigerian Army
receiving the donation on behalf of the Nigerian
Army.
An array of Honeywell Products donated to the

Nigerian Army.

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HIGHLIGHTS OF THE 2015 ANNUAL GENERAL MEETING.
L-R Mr Boniface Okezie, Ayo Ogundejo,

Alhaji Monsuru, Mr T. O. Adegboye and
other Shareholders casting their votes at
the 2015 AGM.
Mr Awosanya Adeshina and Mrs

Bisi Adedigba indicating support
for a motion.
Mr Nona Awu sharing his thoughts at the

AGM.

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HIGHLIGHTS OF THE 2015 ANNUAL GENERAL MEETING.
Cross section of Shareholders.
Mrs Owolabi Abiola Aderemi,

seconding a motion.
Mr Femi Ogunyemi agreeing to a motion.

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& Accounts
FINANCIAL
STATEMENTS
Report of the Audit Committee 43
Report of the Independent Auditors 44
Statement of Financial Position 45
Income Statement 46
Statement of Other Comprehensive Income 47
Statement of Changes in Equity 48
Statement of Cash Flows 49
Index to Notes to the Financial Statements 50
Notes to the Financial Statements 51-87
Value Added Statement 89
Five Year Financial Summary 90

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& Accounts FINANCIAL STATEMENTS
AUDIT COMMITTEE REPORT TO MEMBERS OF HONEYWELL FLOUR MILLS PLC. FOR THE YEAR ENDED MARCH 31, 2016
In compliance with the provisions of Section 359(6) of the Companies and Allied Matters Act CAP C20
LFN 2004, we the members of the Audit Committee of Honeywell Flour Mills Plc received the Audited
Financial Statements for the year ended 31 March, 2016 together with the Management Control Report
from the external auditors and management response thereto at a duly convened meeting of the
committee and hereby report as follows:
We confirm that:
(a) We reviewed the scope and planning of the audit requirements;
(b) We reviewed the external auditors' Management Control Report together with
Management Responses; and
(c) We have ascertained that the accounting and reporting policies of the company for the year
ended 31 March, 2016 are in accordance with legal requirements and agreed with ethical
practices.
In our opinion, the scope and planning of the audit for the year ended 31 March, 2016 were adequate and
Management Responses to the auditors' findings were satisfactory.
We confirm that the internal control system was consistently and effectively monitored through
effective Internal Audit.
The External Auditors confirm that they received full co-operation from the management during the
course of the statutory audit.
The Committee therefore recommended that the Audited Financial Statements for the year ended
31March, 2016 and the External Auditors' Report thereon, be presented for adoption at the Annual
General Meeting.
Dated 20 June, 2016.
Mr. Adebayo Adeleke

Chairman, Audit Committee
FRC/2013/NIM/00000002317
Members of the Audit Committee

Mr. Adebayo Adeleke - Chairman/Shareholder
Alhaji Lateef Ayodeji Shonubi - Shareholder
Dr. Tunji Odebunmi - Shareholder
Lt. Gen. Garba Duba (Rtd) - Director
Mr. Akinsoji Akintayo - Director
Mr. Andrew Smith-Maxwell - Director

43
24, Ilupeju By-Pass, Ilupeju
G.P.O. Box 3260 Lagos, Nigeria.
Tel: + 234 (0) 1-8981859, 7945733
E-mail: bbc@bbccharter.com
bbccharter@yahoo.com
Website: www.bbccharter.com
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF

HONEYWELL FLOUR MILLS PLC
We have audited the accompanying financial statements of Honeywell Flour Mills Plc. on pages 15 to 50 which comprise the
statement of financial position as at 31 March, 2016, the income statement and the statement of comprehensive income , statement
of cash flows, statement of changes in equity , the summary of significant accounting policies and notes to the financial statements.
DIRECTORS' RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

The Company's directors are responsible for the preparation and fair presentation of these financial statements in accordance with
International Financial Reporting Standards and in the manner required by the Companies and Allied Matters Act, CAP C20 LFN
2004. This responsibility includes: designing, implementing and maintaining internal control relevant to the fair presentation of
financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate
accounting policies; and making accounting estimates that are reasonable in the circumstances.
AUDITORS' RESPONSIBILITY
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance
with International Standards on Auditing. Those Standards require that we comply with ethical requirements and plan and perform
the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the
financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal control relevant
to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the
directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OPINION
In our opinion, the financial statements give a true and fair view of the financial position of Honeywell Flour Mills Plc. as at 31
March, 2016 and of its financial performance and cash flows for the year then ended in accordance with the International Financial
Reporting Standards and the Companies and Allied Matters Act, CAP C20 LFN 2004 and the Financial Reporting Council Act No. 6,
2011.
REPORT ON OTHER LEGAL REQUIREMENTS

The Companies and Allied Matters Act requires that in carrying out our audit we consider and report to you on the following matters.
We confirm that:
(ii) in our opinion, proper books of account have been kept by the Company, so far as it appears from our examination of those
books; and
(iii) the Company's statement of financial position and statement of comprehensive income are in agreement with the books of
account.
Lagos, Nigeria
James O. Obogwu
2016 FRC/2013/ICAN/00000002913
For: BBC PROFESSIONALS

Chartered Accountants
Partners: BN: 133294

An Association of
J.O.Obogwu
E.U.Itodo A.M.Adetuyi
Other Offices in Nigeris:
Abuja Akure Benin-City
Prime Independent Accounting Firms
G.C.Egwuenu Ibadan Kaduna

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STATEMENT OF FINANCIAL POSITION FOR THE YEAR ENDED MARCH 31, 2016
Notes 2016 2015

ASSETS
Non-current assets
Property, Plant and Equipment 5 53,757,796 49,282,429
Intangible Assets 6 31,131 36,846
Total Non-Current Assets 53,788,927 49,319,275
Current assets
Inventories 7 5,586,084 12,546,468
Trade and other Current Receivables 8 1,169,430 2,187,332
Cash and Cash Equivalents 9 15,502,135 3,890,369
Total Current Assets 22,257,649 18,624,169
Total assets 76,046,576 67,943,444
LIABILITIES
Current liabilities
Trade and other Payables 10 3,117,770 814,490
Financial Liabilities 11 40,672,816 30,914,573
Current tax Liabilities 15.2 422,639 131,157
Total Current Liabilities 44,213,225 31,860,220
Non-current liabilities
Financial Liabilities 11 10,617,246 11,214,819
Retirement Benefit Obligations 12 1,195,900 962,209
Deferred Income and Accruals 13 25,528 72,985
Deferred tax Liabilities 15.4 3,632,078 3,517,377
Total Non-Current Liabilities 15,470,752 15,767,390
Total Liabilities 59,683,977 47,627,610
EQUITY
Share Capital 19 3,965,099 3,965,099
Share Premium 6,462,041 6,462,041
Retained Earnings 5,935,459 9,888,694
Total Equity 16,362,599 20,315,834
Total liabilities and equity 76,046,576 67,943,444
The financial statements and notes on pages 45 to 87 were approved by the Board of Directors on 21 June, 2016
and signed on its behalf by:
Dr. Oba Otudeko, D.Sc. Hon. CFR Olanrewaju Bamidele Jaiyeola Oluseye Efunyemi Sandey
Chairman Managing Director/CEO Executive Director, Finance
FRC/2013/ICAN/0000002365 FRC/2014/ICAN/00000008542 FRC/2016/ICAN/00000014179

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INCOME STATEMENT FOR THE YEAR ENDED MARCH 31, 2016
Notes 2016 2015

Revenue 17 50,883,780 49,057,511
Cost of Sales (46,522,386) (41,553,977)
Gross Profit 4,361,394 7,503,534

Other Income 18 157,970 232,804
Selling and Distribution Expenses (4,447,346) (3,695,450)
Administrative Expenses (2,121,583) (1,856,363)
Results from Operating Activities (2,049,565) 2,184,525

Finance Income 417,771 481,509
Finance Cost (1,237,548) (1,231,206)
Net Finance (Cost)/Income (819,777) (749,697)
(Loss)/Profit before Taxation (2,869,342) 1,434,828

Taxation 15.1 (154,510) (314,561)
(Loss)/Profit for the Year (3,023,852) 1,120,267
Earnings per Share:

Earnings per Share (kobo) (38.13) 14.13
The notes on pages 51 to 87 form an integral part of these financial statements.

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STATEMENT OF OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED MARCH 31, 2016
Notes 2016 2015

(Loss)/Profit for the year recognized in the income statement (3,023,852) 1,120,267
Remeasurement of post-employment benefit obligation 12 (183,174) (61,547)
Total comprehensive income (3,207,026) 1,058,720
Attributable to the owners of the Company (3,207,026) 1,058,720
Total comprehensive income for the year (3,207,026) 1,058,720

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STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED MARCH 31, 2016
Share Share Retained Total

capital premium earnings equity
At 1 April, 2015 3,965,099 6,462,041 9,888,694 20,315,834
Provision for additional tax liability - - (349,698) (349,698)
Loss for the Year - - (3,023,852) (3,023,852)
Dividend paid during the Year - - (396,510) (396,510)
Other Comprehensive Income

Actuarial Loss - - (183,174) (183,174)
At 31 March, 2016 3,965,099 6,462,041 5,935,459 16,362,599
To 1 April, 2014 3,965,099 6,462,041 10,178,108 20,605,248

Profit for the Year - - 1,120,267 1,120,267
Dividend paid during the Year - - (1,348,134) (1,348,134)
Other Comprehensive Income

Actuarial Loss - - (61,547) (61,547)
To 31 March, 2015 3,965,099 6,462,041 9,888,694 20,315,834


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STATEMENT OF CASH FLOWS FOR THE YEAR ENDED MARCH 31, 2016
Notes 2016 2015

Cash Flows from Operating Activities
Cash generated from operations 16 10,401,823 6,098,645
Retirement benefit paid 12 (172,157) (86,969)
Tax paid 15.2 (98,025) (409,529)
Net Cash Flows generated from Operating Activities 10,131,641 5,602,147
Cash Flows from Investing Activities

Interest Received 417,771 481,509
Purchase of Intangible Assets 6 (4,383) (29,307)
Purchase of Property, Plant and Equipment 5 (6,467,588) (15,202,652)
Proceeds from Sales of Property, Plant and Equipment 7,716 868
Net Cash Flows from Investing Activities (6,046,484) (14,749,582)
Cash Flows from Financing Activities

Interest Payment (1,237,548) (1,231,206)
Proceeds from Borrowings 18,328,626 7,431,762
Repayment of Borrowings (9,172,823) (2,386,403)
Dividend Paid (396,510) (1,348,134)
Cash Generated from Financing Activities 7,521,745 2,466,019
Net Increase/(Decrease) in Cash and Cash Equivalents 11,606,902 (6,681,416)

Cash and Cash Equivalents at 1 April 3,889,387 10,570,802
Cash and Cash Equivalents at 31 March 9 15,496,289 3,889,387

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INDEX TO NOTES TO THE FINANCIAL STATEMENTS
Note Page Note Page
1 Reporting Entity 51 4 Risk Management 65

2 Basis of preparation 51 a. Credit Risk 65
a. Statement of compliance 51 b. Liquidity Risk 65
b. Basis of measurement 51 c. Market Risk 66
c. Functional and presentation currency 51 d. Operational Risk 66
d. Use of estimates and judgments 51 5 Property, plant and equipment 68-69
3 Significant Accounting Policies 52 6 Intangible assets 70
a. Going concern 52 7 Inventories 70
b. Business combination 52 8 Trade and other current receivables 70-71
c. Segment reporting 52 9 Cash and cash equivalent 72
d. Foreign currency translation 53 10 Trade payables and other current liabilities 72
e. Property, plant and equipment 53 11 Financial liabilities 73
f. Intangible assets: 54 12 Retirement benefit obligations 74
(i). Computer software 55 13 Deferred income and accruals 75
(ii). Amortization of intangible assets 55 14 Profit before tax 75
g. Financial assets 55 15 Taxation 75-77
(i) Classification 55-56 16 Statement of cash flows 78
(ii) Recognition and measurement 56 17 Segment information 78-79
(iii) Offsetting financial instruments 57 18 Other income 80
(iv) Impairment of financial assets 57 19 Share capital 80
(v) Impairment of non-financial assets 58 20 Chairman and directors' emolument 80
h. Inventories 59 21 Employee and related remuneration 81
i. Trade receivables 59 22 Contingent liabilities 82
j. Research and development 59 23 Loans and other transactions
k. Cash, cash equivalents and bank overdrafts 59 favouring Directors 82
l. Borrowings 60 24 Contraventions 82
m. Trade payables 60 25 Comparative figures 82
n. Investments 60 26 Earnings per share 82
o. Provisions 60 27 Approval of financial statements 83
p. Tax: 61 28 Significant financial judgments 83-85
(I). Current tax 61 29 New accounting standards issued
(ii). Deferred tax 61 but not yet adopted 85-87
(iii).Tax exposures 62
q. Employee benefits 62
(i). Defined benefit plan 62
(ii). Defined contribution scheme 63
(iii).Short-term employee benefit 63
r. Revenue recognition: 63
(i). Sales of goods 63
(ii). Interest on income 64
s. Dividend distribution 64
t. Earnings per share 64
u. Share Capital 64

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2016
1 REPORTING ENTITY
Honeywell Flour Mills Plc was initially registered as Gateway Honeywell Flour Mills Limited on
June 21, 1983. A change in the Company's ownership structure led to a change of name to
Honeywell Flour Mills Limited in June, 1995. The Company was converted to a Public Liability
Company in 2008. Its shares were listed on the Nigeria Stock Exchange (NSE) in 2009. As part of
its vertical integration strategy, the Company acquired 100% ownership of Honeywell Superfine
Foods Limited, manufacturers of pasta and noodles in 2008.
Honeywell Flour Mills Plc is a Company domiciled in Nigeria. The Company is principally engaged in
the manufacture and marketing of wheat-based products including flour, semolina, whole wheat
meal, noodles and pasta.
2 BASIS OF PREPARATION
(a) Statement of Compliance
The Financial Statements have been prepared in accordance with the International Financial
Reporting Standards (IFRS) being Standards and Interpretations issued by the International
Accounting Standards Board (IASB) in force as at 31 December, 2013. They have been prepared
in line with IFRS accounting policies selected by the Company on transition to IFRS.
(b) Basis of Measurement

The Financial Statements have been prepared under the historical cost basis, except for items
measured at fair value and the use of actuarial methods for estimating certain employee benefits.
(c) Functional and Presentation Currency

These financial statements are presented in the Nigerian Naira, which is the Company's
functional currency. All financial information presented in Naira has been rounded to the nearest
thousand.
(d) Use of Estimates and Judgments

The preparation of the Financial Statements in conformity with IFRS requires management to
make judgements, estimates and assumptions that affect the application of accounting policies
and reported amounts of assets, liabilities, income and expenses. Actual results may differ from
these estimates.
Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to
accounting estimates are recognized in the year in which the estimates are revised and in any
future years affected.

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Information about critical judgments in applying accounting policies that have the most significant
effect on the amounts recognized in the financial statements is included in the following notes:
- measurement of defined benefit obligations; and
- provisions and contingencies.
3 SIGNIFICANT ACCOUNTING POLICIES

The accounting policies set out below have been applied consistently to all periods presented in these
financial statements and in preparing the opening IFRS statements of financial position at 1 April 2011
for the purposes of the transition to IFRS, unless otherwise indicated.
(a) Going Concern

The Directors have a reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. The Company continues to adopt the
going concern basis in preparing its financial statements.
(b) Business Combination

Business combinations involving entities under common control are outside the scope of IFRS 3.
Management exercises its judgement to apply the pooling of interest method of accounting for
business combination in accordance with IAS 8, 10 - 12. The IAS 8 & 12 allows management to
consider the most relevant conceptual framework in developing an accounting policy where
IFRS has no specific requirements.
Under a pooling of interests-type method, the acquirer accounts for the combination as follows:
The assets and liabilities of the acquiree are recorded at book value not fair value
(although adjustments should be recorded to achieve uniform accounting policies);
No goodwill is recorded. The difference between the acquirer's cost of investment
and the acquiree's equity is presented separately within Other Comprehensive Income
Statement;
Comparative amounts are restated as if the combination had taken place at the beginning
of the earliest comparative period presented.
(c) Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the
Chief Operating Decision Maker. The Chief Operating Decision Maker, who is responsible for
allocating resources and assessing performance of the operating segments, has been identified as
the Board of Directors.

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The Companys business operating segments are identified by two factories located at Ikeja and
Apapa. The Apapa factory manufactures flour, semolina, wheat meal and brown flour while the Ikeja
factory manufactures pasta and noodles.
(d) Foreign Currency Transactions

Foreign currency transactions are translated into Naira using the exchange rates prevailing at the
dates of the transactions or valuations where items are re-measured. Foreign exchange gains and
losses resulting from the settlement of such transactions and from the translation at year-end
exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognized in the income statement, except when deferred in other comprehensive income as
qualifying cash flow hedges and qualifying net investment hedges.
Foreign exchange gains and losses that relate to borrowings and cash equivalents are presented in
the income statement within 'finance income or cost'. All other foreign exchange gains and losses
are presented in the income statement within 'other gains / (losses) - net'.
(e) Property, Plant and Equipment

Land and building held for use in the production or supply of goods or services, or for
administration purposes, are stated in the statement of financial position at deemed cost at the date
of transition to IFRS less accumulated depreciation and any accumulated impairment losses.
All other assets are stated at historical cost less accumulated depreciation and accumulated
impairment losses. All other property, plant and equipment are stated at historical cost or
valuation less accumulated depreciation and impairment losses. Historical cost includes
expenditure that is directly attributable to the acquisition of the items. Cost may also include
transfers from equity of any gains/losses on qualifying cash flows hedges of foreign currency
purchases of property, plant and equipment.
Purchased software that is integral to the functionality of the related equipment is capitalized as
part of the equipment.
Subsequent costs are included in the asset's carrying amount or recognized as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will
flow to the Company and the cost can be measured reliably. The carrying amount of the replaced
cost is derecognized. All other repairs and maintenance are charged to the income statement
during the financial period in which they are incurred.

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An item of Property, Plant and Equipment is derecognised on disposal or when no future

economic benefits are expected from its use. Gains or losses on disposal or de-recognition 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 in income
statement.
Depreciation is provided on components that have homogenous useful lives by using the straight
line method so as to depreciate the initial cost down to the residual value over the estimated useful
lives.
The useful lives are as follows:
Buildings 20 to 50 years
Tools, Furniture/Fittings and Equipment 2 to 5 years
Vehicles 4 years
Land Not depreciated
Assets residual values and useful lives are reviewed and adjusted if appropriate at the end of each
reporting date.
Where an indication of impairment exists, an assets carrying amount is written down

immediately to its recoverable amount, if the assets carrying amount is greater than its estimated
recoverable amount. The gain or loss arising on the disposal or retirement of an asset is
determined as the difference between the sales proceeds and the carrying amount of the asset and
is recognized in the income statement for the period.
(f) Intangible Assets
(i) Computer Software

Acquired computer software licenses are capitalized on the basis of the costs incurred to
acquire and bring to use the specific software. These costs are amortized over their estimated
useful lives. Costs associated with maintaining computer software programmes are
recognized as expenses incurred. Development costs that are directly attributable to the
design and testing of identifiable and unique software products controlled by the Company
are recognized as intangible assets when the following criteria are met:

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It is technically feasible to complete the software product and use or sell it;
Management intends to complete the software product and use or sell it;
There is an ability to use or sell the software product;
It can be demonstrated how the software product will generate probable future
economic benefits;
Adequate technical, financial and other resources to complete the development and use or
sell the software product are available; and
The expenditure attributable to the software product during its development can
be reliably measured.
Directly attributable costs that are capitalized as part of the software product include the software
development employee costs and an appropriate portion of relevant overheads. Other
development expenditure that do not meet these criteria are recognized as expenses incurred.
Development costs previously recognized as expenses are not recognized as assets in subsequent
periods.
Computer software development costs recognized as assets are amortized over their estimated
useful lives.
(ii) Amortisation of intangible assets

Intangible assets are amortized on a straight line basis in the income statement over their
estimated useful lives, from the date that they are available for use. The estimated useful life of
computer software for the current and comparative years is five (5) years. Amortization methods,
useful lives and residual values are reviewed at each reporting date and adjusted for, if
appropriate.
(g) Financial Assets
(i) Classification
The Company classifies its financial assets in the following categories: at fair value through profit
or loss, loans and receivables, and available for sale. The classification depends on the purpose for
which the financial assets were acquired. Management determines the classification of its
financial assets at initial recognition.
- Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss are financial assets held for trading.

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A financial asset is classified in this category if acquired principally for the purpose of selling in the
short term. Derivatives are also categorized as held for trading unless they are designated as hedges.
Assets in this category are classified as current assets if expected to be settled within 12 months;
otherwise, they are classified as non-current.
- Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market. They are included in current assets, except for maturities
greater than 12 months after the end of the reporting period. These are classified as non-current
assets. The Company's loans and receivables comprise of trade and other receivables and cash
and cash equivalents in the financial statement.
- Available-for-sale financial assets

Available-for-sale financial assets are non-derivatives that are either designated in this category
or not classified in any of the other categories. They are included in non-current assets unless the
investment matures or management intends to dispose of it within 12 months of the end of the
reporting period.
(ii) Recognition and measurement

Regular purchases and sales of financial assets are recognized on the trade-date, the date on which
the Company commits to purchase or sell the asset. Investments are initially recognized at fair
value plus transaction costs for all financial assets not carried at fair value through profit or loss.
Financial assets carried at fair value through profit or loss are initially recognized at fair value,
and transaction costs are expensed in the income statement. Financial assets are derecognized
when the right to receive cash flows from the investments has expired or has been transferred and
the Company has transferred substantially all risks and rewards of ownership. Available-for-sale
financial assets and financial assets at fair value through profit or loss are substantially carried at
fair value. Loans and receivables are subsequently carried at amortized cost using the effective
interest method.
Gains or losses arising from changes in the fair value of the financial assets at fair value through
profit or loss category are presented in the income statement within other (losses) / gains - not in
the period in which they arise. Dividend income from financial assets at fair value through profit
or loss is recognized in the income statement as part of other income when the Company's right to
receive payments is established.

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Changes in the fair value of monetary and non-monetary securities classified as available for
sale are recognized in other comprehensive income. When securities classified as available for
sale are sold or impaired, the accumulated fair value adjustments recognized in equity are
included in the income statement as 'gains and losses from investment securities'.
Interest on available-for-sale securities calculated using the effective interest method is

recognized in the income statement as part of other income. Dividends on available-for-sale
equity instruments are recognized in the income statement as part of other income when the
Company's right to receive payments is established.
(iii) Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the statement of
financial position when there is a legally enforceable right to offset the recognized amounts and
there is an intention to settle on a net basis or realize the asset and settle the liability
simultaneously.
(iv) Impairment of financial assets

The Company assesses at the end of each reporting period whether there is objective e v i d e n c e
that a financial asset or group of financial assets is impaired. A financial asset or a group of
financial assets is impaired and impairment losses are incurred only if there is objective
evidence of impairment as a result of one or more events that occurred after the initial
recognition of the asset (a 'loss event') and that loss event (or events) has an impact on the
estimated future cash flow of the financial asset or group of financial assets that can be reliably
estimated. The criteria the company uses to determine that there is objective evidence of an
impairment loss include:
signicant nancial difculty of the issuer or obligor;
a breach of contract, such as a default or delinquency in interest or principal payments;
the Company, for economic or legal reasons relating to the borrower's nancial difculty,
granting to the borrower a concession that the lender would not otherwise consider;
it becomes probable that the borrower will enter bankruptcy or other nancial reorganization;
the disappearance of an active market for that nancial asset because of nancial difculties;
or observable data indicating that there is a measurable decrease in the estimated future cash
ows from a portfolio of nancial assets since the initial recognition of those assets, although
the decrease cannot yet be identied with the individual nancial assets in the portfolio.

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adverse changes in the payment status of borrowers in the portfolio; and national or local
economic conditions that correlates on the assets in the portfolio.
The Company first assesses whether objective evidence of impairment exists. For loans and
receivables category, the amount of the loss is measured as the difference between the asset's
carrying amount and the present value of estimated future cash flow (excluding future credit
losses that have not been incurred) discounted at the financial asset's original effective interest
rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in the
income statement. If a loan or held-to-maturity investment has a variable interest rate, the
discount rate for measuring any impairment loss is the current effective interest rate determined
under the contract.
As is practical and expedient, the company may measure impairment on the basis of an
instrument's fair value using an observable market price. If in a subsequent period, the amount of
the impairment loss decreases and the decrease can be related objectively to an event occurring
after the impairment was recognised (such as an improvement in the debtor's credit rating), the
reversal of the previously recognised impairment loss is recognised in the income statement.
(v) Impairment of non - financial assets

Assets that have an indefinite useful life - for example, goodwill or intangible assets not ready for
use - are not subject to amortization and are tested annually for impairment. Assets that are subject
to amortization are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell
and value in use. For the purposes of assessing impairment, assets are tested at the lowest levels
for which there are separately identifiable cash flows (cash-generating units). Non-financial
assets other than goodwill that suffered impairment are reviewed for possible reversal of the
impairment at each reporting date.

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(h) Inventories
Inventories are stated at the lower of cost and estimated net realisable value. Costs comprise direct
materials costs and where applicable, direct labour costs and those overheads that have been
incurred in bringing the inventories to their present location and condition. Cost is calculated
using the weighted average method. Net realisable value represents the estimated selling price
less all estimated costs of completion and costs to be incurred in marketing, selling and
distribution.
Spare parts and servicing equipment are usually carried as inventory and recognized in profit or
loss as consumed. However, major spare parts and stand-by equipment qualify as property, plant
and equipment when the Company expects to use them during more than one period. Similarly, if
the spare parts and servicing equipment can be used only in connection with an item of property,
plant and equipment, they are accounted for as property, plant and equipment. Such classified
spares are depreciated as property, plant and equipment over the useful life on a straight line basis.
(i) Trade Receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortized
cost using the effective interest rate method, less provision for impairment. The collectability of
trade receivables is reviewed on an ongoing basis. A provision for impairment of trade receivables
is established when there is objective evidence that the Company will not be able to collect all
amounts due, according to the original terms of the receivables. The amount of the provision is the
difference between the asset's carrying amount and the present value of estimated future cash
flows. The amount of the provision is recognised in the income statement.
(j) Research and Development

Research and development expenditure is charged against profits in the year in which it is
incurred, unless it meets the criteria for capitalisation set out in IAS 38 'Intangible assets'.
(k) Cash, Cash Equivalents and Bank Overdrafts

Cash, cash equivalents and bank overdrafts include cash at bank and in hand plus short-term
deposits less overdrafts. Short-term deposits have a maturity of less than three months from the
date of acquisition. Bank overdrafts are repayable on demand and form an integral part of the
Company's cash management.

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(l) Borrowings
Interest- bearing bank loans and overdrafts are recorded as the proceeds received, net of direct
issue costs. Finance charges, including premiums payable on settlement or redemption and direct
issue costs, are accounted for on an accruals basis through the income statement using the
effective interest method and are added to the carrying amount of the instrument to the extent they
are not settled in the period in which they arise.
(m) Trade Payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary
course of business from suppliers. Accounts payable are classified as current liabilities if
payments are due within one year or less. If not, they are presented as non-current liabilities. Trade
payables are recognised initially at fair value and subsequently measured at amortised cost using
the effective interest method.
(n) Investments
Investments are classified as either held-to-maturity, held-for-trading, loans and receivables or
available-for-sale. Held-to-maturity investments and loans and receivables are measured at
amortized cost. Held-for-trading and available-for-sale investments are measured at fair value.
Where securities are held-for-trading purposes, gains and losses arising from changes in fair
value are included in the income statement for the period. For available-for-sale investments,
gains and losses arising from changes in fair value are recognised directly in equity, until the
security is disposed of or is determined to be impaired, at which time the cumulative gain or loss
previously recognised in equity is included in the income statements for the period.
(o) Provisions
Provisions are recognised when the Company has a present legal or constructive obligation as a
result of a past event, and it is probable that the Company will be required to settle that obligation
and the amount has been reliably estimated. Provisions for restructuring costs are recognised
when the Company has a detailed formal plan for the restructuring that has been communicated to
affected parties. Provisions are not recognised for future operating losses.
Provisions are measured at the present value of the expenditures expected to be acquired to settle
the obligation using a pre-tax rate that reflects current market assessments of the time value of
money and risks specific to the obligation. The increase in the provision due to passage of time is
recognised as interest expense.

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(p) Tax
Income tax expense represents the sum of current tax expense and deferred tax expense. Current
tax and deferred tax are recognised in income statement except to the extent that it relates to a
business combination, or items recognised directly in equity or in other comprehensive income.
(i) Current Tax

Current tax is the expected tax payable or receivable on the taxable income or loss for the
year, using tax rates statutorily enacted at the reporting date, and any adjustment to tax
payable in respect of previous years. The Company is subject to the following types of
current income tax:
Companies Income Tax - This relates to tax on revenue and profit generated by the
Company during the year, to be taxed under the Companies Income Tax Act Cap C21, LFN
2004 as amended to date.
Tertiary Education Tax - Tertiary Education tax is based on assessable income of the
Company and is governed by the Tertiary Education Trust Fund (Establishment) Act LFN
2011.
(ii) Deferred Tax
Deferred tax is recognised in respect of temporary differences between the carrying
amount of assets and liabilities for financial reporting purposes and the amounts used for
taxation purposes. Deferred tax is not recognised for:
Taxable temporary differences arising on the initial recognition of goodwill.
The measurement of deferred tax reflects the tax consequences that would follow the manner in
which the Company expects at the end of the reporting period to recover or settle the carrying
amounts of its assets and liabilities. For investment property that is measured at fair value, the
presumption that the carrying amount of the investment property will be recovered through sale has
not been rebutted.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences
when they reverse, using tax rates enacted or substantively enacted at the reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax
liabilities and assets, and they relate to taxes levied by the same tax authority on the same taxable
entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net
basis or their tax assets and liabilities will be realized simultaneously.

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A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary
differences to the extent that it is probable that future taxable profits will be available against which
they can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the
extent that it is no longer probable that the related tax benefits will be realised.
(iii) Tax Exposures

In determining the amount of current and deferred tax, the Company takes into account the
impact of uncertain tax postions and whether additional taxes and interest may be due. This
assessment relies on estimates and assumptions and may involve a series of judgements
about future events. New information may become available that causes the Company to
change its judgement regarding the adequacy of existing tax liabilities; such changes to tax
liabilities will impact tax expenses in the period that such determination is made.
(q) Employee benefits
(i) Defined benefit plan

The defined benefit plan defines an amount of gratuity the employee will receive on
retirement, dependent on date of employment, year of service and compensation. The
defined benefit plan is being accounted for using the projected unit method that considers the
rate of inflation, the degree of salary increases of employees, the retirement age among other
factors.
The liability recognised in the balance sheet in respect of defined benefit pension plan is the
present value of the defined benefit obligation at the end of the reporting period less the fair
value of plan assets, together with adjustments for unrecognised past service costs. The
defined benefit obligation is calculated annually by independent actuaries using the
projected unit credit method. The present value of the defined benefit obligation is
determined by discounting the estimated future cash outflow using market rates on
Government Bonds.
Actuarial gains and losses arising from experienced adjustments and changes in actuarial
assumptions are charged or credited to equity in other comprehensive income in the period
in which they arise. Past service costs are recognised immediately in income statement.

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(ii) Defined contribution scheme

The Company operates a defined contribution plan which is funded by contributions from
the Company and the employees. The Company's contribution is recognised as employee
benefit expenses and charged to the income statement. The contributions of both the
Company and the employees are paid on a monthly basis to a pension fund administrator.
The Company has no legal or constructive obligation to pay further contributions if the
pension fund administrator does not hold sufficient assets to pay all employees the benefits
relating to employee service in the current and prior periods. The contributions are
recognised as employee benefit expenses when they are due.
(iii) Short-term employee benefit

Short-term employee benefit obligations are measured on an undiscounted basis and are
expensed as the related service is provided.
A liability is recognised for the amount expected to be paid under short-term cash bonus or
profit sharing plan if the Company has a present legal or constructive obligation to pay this
amount as a result of past services provided by the employee, and the obligation can be
estimated reliably.
(r) Revenue Recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of goods
and services in the ordinary course of the Company's activities. Revenue is shown net of Value-
Added Tax, returns, rebates and discounts.
The Company recognises revenue when the amount of revenue can be reliably measured, it is
probable that future economic benefits will flow to the entity and specific criteria have been met
for each of the Company's activities as described below:
(i) Sale of Goods

The Company manufactures and sells a range of products to the distributors and dealers.
Sale of goods are recognised when the Company has delivered products to the customers
and there is no unfulfilled obligation that could affect the customers' acceptance of the
products. Delivery does not occur until the products have been shipped to the specified
locations; the risks of obsolescence and loss have been transferred to the customers and
either the customers have accepted the products in accordance with the sales contract, or the
Company has objective evidence that all criteria for acceptance have been satisfied.

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The products are often sold with discounts and rebates. Sales are recorded based on the price
specified on the sales invoice net of the discounts, rebates and returns at the time of sale.
Sales are also recognised when the customer self-collects the product directly at the C o m p a n y s
premises during which the risks and rewards of ownership passes to the customer at the point of
loading after the customer's delivery truck leaves the Companys premises. No element of
financing is deemed present where sales are made on agreed credit terms which are consistent
with the market practice.
(ii) Interest Income

Interest income is recognised using the effective interest rate method. When a loan and
receivable is impaired, the Company reduces the carrying amount to its recoverable amount,
being the estimated future cash flow discounted at the original effective interest rate of the
investment, and continues unwinding the discount as interest income. Interest income on
impaired loans and receivables is recognised using the original effective interest rate.
(s) Dividend Distribution

Dividend distribution to the Company's Shareholders is recognised as a liability in the Company's
financial statements in the period in which the dividends are approved by the Company's
Shareholders. Dividends are recognised once paid.
(t) Earnings per Share

The Company presents earnings per share (EPS) data for its ordinary shares. EPS is calculated by
dividing the profit or loss attributable to ordinary shareholders of the Company by the number of
ordinary shares held at the year end.
(u) Share Capital

The Company has only one class of Shares - ordinary shares which are classified as equity. When
new shares are issued, they are recorded in share capital at their par value. The excess of the issue
price over the par value is recorded in the share premium reserve.
Incremental costs directly attributed to the issue of ordinary shares are recognised as a deduction
from equity, net of any tax effects.

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4 RISK MANAGEMENT
Risk management is inherent in the business operations of the Company. Management has set up
processes and systems to identify, assess, monitor and control business risks including the following :-
(a) Credit Risk

This refers to the risk that a trade debtor will default by failing to make payments in accordance
with the agreed credit terms and conditions. The possible impact of the credit risk is poor Account
Receivable assets quality arising from high level of bad and doubtful debts and possible
impairment of shareholders' funds. The carrying amount of financial assets represents the
maximum credit exposure.
Mitigating Measures
Credit application follows rigorous and extensive credit review and approval processes.
All credits are secured by insurance or bank bonds.
Once conditions precedent to credit utilization are met by the customer, the approved
credit is updated, monitored and controlled by the ERP on real times basis in accordance
with credit terms.
Credit utilization reports are prepared and monitored on a daily basis.
(b) Liquidity Risk

This refers to the risk of the company's inability to finance its operations and meet its obligations
when they become due without incurring unacceptable losses. Liquidity risk includes the inability
to manage unplanned decreases or changes in funding sources.
Mitigating Measures
Efcient and effective working capital management.
Efcient Naira facility management.
Efcient funds management to eliminate idle funds, meet obligations as they fall due and
reduce interest expense to the minimum level.
Liquidity and working capital management reports are prepared and monitored on a daily
basis.
The Treasury Department is well structured and equipped under the management of a very
experienced and well trained team.

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(c) Market Risk

Market risk is the risk of nancial loss due to the change in value of the market risk factors. The
Company is faced with the following market risk factors.
Interest rate risk: - The risk that interest rate will change adversely at the money market.
Foreign exchange risk: - The risk that foreign exchange rates will uctuate unfavorably
at foreign exchange market.
Commodity risk: - The risk that wheat prices will signicantly increase at the
international commodity markets.
Mitigating Measures
Efcient management of exchange and interest rate risks including generation of
relevant risk management reports for monitoring and review on a daily and weekly basis.
Monitor the money, capital and foreign exchange markets including micro and macro
economic environment on a daily basis.
Efcient management of the commodity risk by the Logistics and Supplies Department
with a full-edged experienced and well trained team in the area of wheat dynamics and
procurement strategies.
Monitoring of price dynamics and changes at the relevant Commodity Exchange Boards
on a real time basis and take proactive decisions on a timely basis.
The commodity risk affects the global milling industry as the wheat prices are
determined at the international commodity markets. We usually increase product price
in response to global volatility in wheat prices in order to recover some portion of the rise
in wheat prices.
(d) Operational Risk

This relates to the risk of loss resulting from inadequate or failed internal processes, controls,
procedures, people, and systems. Operational risk is inherent in the business activities. These
include risk of inadequate haulage partners required to achieve the Company's objectives in
terms of sales volume and profit; risk of wastages, downtime and other associated losses arising
from inefficient plant operations; risk of breakdown of ERP and IT infrastructure or outright loss
of critical operational/business data and information; risk of loss of Company assets due to
unexpected disasters which may affect business operations; risk of breakdown of internal
control systems and misstatement of financial statements.

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Mitigating Measures
Efficient and effective maintenance culture to prevent down time and inefficient production
operations.
Control activities are an integral part of the Company's day to day operations and are defined
at every business area.
Existence of robust ERP and comprehensive computerisation of internal business processes,
systems and procedures.
Existence of robust IT business continuity and disaster recovery programmes.
All insurable business risks are assessed, identified and adequately covered/insured.
Existence of documented standard operating procedures for all business activities and
operations.
All key positions have a minimum of one under-study who can assume the roles immediately
with minimum support, and eventually grow into the position.
The Company continually trains talents to meet its future skill requirements.
Continuous recruitment of qualified haulage contractors to meet corporate requirements and
prevent shortage of delivery trucks. The Company also acquired and managed some of its
delivery trucks e.g bulk flour loading trucks.
It has a strong, active and experienced Internal Audit Team. The Internal Audit Team generates
Reports highlighting control weaknesses periodically to the Management and Board Audit
Committee.
The Company's internal control and risk management systems ensure that material errors or
inconsistencies in the financial statements are identified and corrected. Financial Statements
are prepared in accordance with accounting standards and policies.
Financial statements are prepared periodically on monthly and quarterly bases for the review
of the Management and Board. Performance is monitored and compared with budgets.

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5 PROPERTY, PLANT AND EQUIPMENT
Capital Furniture
work Plant and And Motor
Land Building in progress machinery Equipment vehicles Total
a) COST
At April 1, 2015 5,660,603 8,450,077 21,753,899 18,719,137 289,198 689,225 55,562,139
Of Additions - 37,953 5,605,203 609,836 43,504 171,092 6,467,588
Reclassification - 17,908 (441,180) 423,272 - - -
Of Disposals - - - (72) (9,083) (9,155)
At March 31, 2016 5,660,603 8,505,938 26,917,922 19,752,245 332,630 851,234 62,020,572
DEPRECIATION
To April 1, 2015 - 695,060 - 4,970,297 192,796 421,557 6,279,710
Charge for the year - 249,914 - 1,552,107 50,803 137,881 1,990,705
On Disposals - - - (64) (7,575) (7,639)
To March 31, 2016 - 944,974 - 6,522,404 243,535 551,863 8, 262,776
CARRYING AMOUNT
At March 31, 2016 5,660,603 7,560,964 26,917,922 13,229,841 89,095 299,371 53,757,796
At March 31, 2015 5,660,603 7,755,017 21,753,899 13,748,840 96,402 267,668 49,282,429
Depreciation expenses of N1.768b (2015: N1.791b) has been charged in 'cost of goods sold', N78.296m
(2015: N75.724m) in 'selling and marketing costs' and N144.409m (2015: N138.740m ) in administrative
expenses'.

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Capital Furniture
work Plant and and Motor
Land Building in progress machinery equipment vehicles Total
b) COST
At April 1, 2014 5,660,603 8,402,104 6,796,195 18,683,438 265,531 555,632 40,363,503
Of additions - 47,973 14,957,704 37,597 23,888 135,490 15,202,652
On disposals - - - (1,898) (221) (1,897) (4,016)
At March 31, 2015 5,660,603 8,450,077 21,753,899 18,719,137 289,198 689,225 55,562,139
DEPRECIATION
To April 1, 2014 - 446,357 - 3,399,932 139,771 291,993 4,278,053
Charge for the year - 248,703 - 1,572,263 53,223 131,261 2,005,450
On disposals - - - (1,898) (198) (1,697) (3,793)
To March 31, 2015 - 695,060 - 4,970,297 192,796 421,557 6,279,710
CARRYING AMOUNT
At March 31, 2015 5,660,603 7,755,017 21,753,899 13,748,840 96,402 267,668 49,282,429

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6 INTANGIBLE ASSETS 2016 2015

Cost
At April 1, 2015 51,040 21,733
Additions 4,383 29,307
Disposals (2,494) -
At March 31, 2016 52,929 51,040
Amortization and impairment

At April 1, 2015 14,194 9,401
Amortization for the year 9,277 4,793
Disposals (1,673) -
At March 31, 2016 21,798 14,194
Net Carrying amount 31,131 36,846
Amortization expenses of N9.277m (2015: N4.793m) has been charged in administrative expenses.
7 INVENTORIES
In thousands of Naira 2016 2015

Raw Materials and Consumables 5,351,144 7,374,822
Work-in-progress 110,470 -
Finished Goods 124,200 447,202
Goods-in-Transit - 4,724,444
Total 5,586,084 12,546,468
The amount of write down of inventories recognised as expenses is N43.67million(2015:N355million).
This expense is included in cost of sales and selling and distribution expenses. Inventory recognised as expenses
during the period totaled N54.67 million (2015: N87.06).
There are no inventories pledged as security for liabilities.
There was an impairment provision of N365.80million on inventory written back during the year.
This was as a result of crystalization of the raw material during the year.
8 TRADE AND OTHER CURRENT RECEIVABLES

Gross trade receivables 744,251 1,108,763
Allowances for Impairment Losses (395,231) (409,398)
Net Trade Receivables 349,020 699,365

Advance and Prepayments 820,410 1,487,967
1,169,430 2,187,332
There is no material difference between the fair value of receivables and their carrying amount.

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Analysis of Trade Receivables

The analysis below analyses changes in the allowances for impairment losses in the year.

Ageing of Trade Receivables
Total Trade Receivables 744,251 1,108,763
Less: Impairment Provision for Trade Receivables (395,231) (409,398)
349,020 699,365
of which:
Carrying amount neither past due nor impaired 217,921 567,702
Carrying amount past due but less than three months 64,546 106,125
Carrying amount past due for more than three months but less than six months 59,157 119,615
Carrying amount past due for more than six months but less than one year 79,405 49,636
Carrying amount past due more than one year 323,222 265,685
744,251 1,108,763
Impairment for trade receivables (395,231) (409,398)
349,020 699,365
Impairment Provision for Trade and other Receivables

At April 1 409,398 360,435
Charge to income statement for the period 71,636 48,963
Allowance no longer required (85,804) -
At March 31 395,230 409,398
a. The maximum exposure to credit risk at the reporting date is the carrying value of the receivables. The Company holds
insurance/bank bonds as security against default.
b. Impairment allowance is made when there is objective evidence that the Company will not be able to collect the debts. The
allowance raised is the amount needed to reduce the carrying value to the present value of expected future cash receipts. Bad debts
are written off when identified.
c. As at 31 March, 2016, trade receivables of N218 million (2015:N568 million) were past due but not impaired. These relate to a
number of independent customers for whom there is no recent history of default. Extensive analysis of customer credit risk were
performed on the customers.
d. The amount of the provision for impairment was N395 million as at 31, March 2016 (2015:N409 million). The individually
impaired receivables mainly relate to wholesalers, which are in unexpectedly difficult economic situations. It was assessed that a
portion of the receivables is expected to be recovered. Plans are in place to ensure substantial recovery of the receivables.
Impairment losses are presented in the income statement with selling and marketing expenses.

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2016 2015
9 CASH AND CASH EQUIVALENTS
Bank and Cash Balances 11,864,130 443,294
Short Term Deposits 3,638,005 3,447,075
Balance as stated in the statement of financial position as at 31 March 15,502,135 3,890,369

Less Bank Overdrafts shown as liabilities in the statement of financial position (5,846) (982)
Cash and Cash Equivalents 15,496,289 3,889,387
There is no material difference between the fair value and the carrying amount of cash equivalents.
Short term deposits represent temporary excess of liquidity invested in low-risk short-term bank
deposits with a maturity not exceeding 365 days.
2016 2015
10 TRADE AND OTHER PAYABLES
Due within one year
Trade payables 1,847,807 775,338
Accruals 1,204,515 22,500
Pension and sundry taxes 6,435 16,652
Unclaimed dividend 59,013 -
Balance at March 31 3,117,770 814,490
Accrued liabilities represent miscellaneous contractual liabilities that relate respectively to expenses
that were incurred but not paid for at the year-end.
The carrying amount of trade and other payables and accrued liabilities is considered to be in line
with their fair value at the reporting date.
The unclaimed dividend represents amount returned by the Companys Registrars in line with the
Security and Exchange Commissions directive that all unclaimed dividends in the custody of the
registrars should be returned to the paying company 12 months after the date of approval of dividend at a
general meeting.

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2016 2015
11 FINANCIAL LIABILITIES
Current Loans and Advances
Bank Loans 16,370,008 14,960,767
Bank Overdrafts 5,846 982
Import Finance Facilities 24,296,962 15,952,824
40,672,816 30,914,573
Non-Current Loans and Advances
Bank Loans 10,617,246 11,214,819
10,617,246 11,214,819
a) Weighted average cost of borrowings was 12% ( 2015:13%) annually.
b) Bank loans and overdraft are secured by mortgage on property, plant and equipment while import
finance facilities are secured by trade receivables.
c) The fair value of current borrowings equals their carrying amount, as the impact of discounting is not significant.
d) The carrying amounts and fair value of the non-current borrowings are as follows.
The fair values are based on cash flows discounted using rates based on the average borrowing rate of 17%
(2014:17%)
Carrying Amount Fair Value
2016 2015 2016 2015
Guaranty Trust Bank Plc. (CBN Intervention Fund) - 111,111 - 111,111
Skye Bank Plc. 1,825,297 426,219 1,825,297 426,219
First bank of Nigeria Limited 2,334,720 3,877,489 2,334,720 3,877,489
First bank of Nigeria Limited (CBN Intervention Fund) 850,562 1,000,000 850,562 998,456
Bank of industry Limited 5,606,667 5,800,000 5,606,667 5,735,875
10,617,246 11,214,819 10,617,246 11,149,150
The loan from Bank of Industry Limited (BOI) was granted to the Company to finance the new Pasta Factory which will
be located at Sagamu. The loan has a tenor of seven (7) years inclusive of two (2) years moratorium on principal
repayment beginning from date of first disbursement. Interest rate on the loan is 10%. The loan and accrued interest on
the Bank of Industrys (BOI) loan was guaranteed by Skye Bank Plc.

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12 RETIREMENT BENEFIT OBLIGATIONS

The Company has both defined benefit and defined contribution plans.
Defined contribution plan
A defined contribution plan is a pension plan under which the Company pays fixed contributions to a separate entity.
The Company has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient
assets to pay all employees the benefits relating to employee service in the current and prior periods.
The Company pays contributions to publicly or privately administered pension insurance plans on a mandatory,
contractual or voluntary basis.
The Company has no further payment obligations once the contributions have been paid. The contributions are
recognized as employee benefit expense when they are due.
Defined benefit plan

A defined benefit plan is a pension plan that defines an amount of pension benefit that an employee will receive on
retirement, usually dependent on one or more factors, such as age, years of service and compensation. The Company
operates unfunded defined benefit plans for qualifying employees of the company.
The liability recognized in the statement of financial position in respect of defined benefit pension plans is the present
value of the defined benefit obligation less the fair value of planned assets, together with adjustments for unrecognized
actuarial gains or losses and past service costs.
The most recent actuarial valuations of the present value of the defined benefit obligation were carried out at 31
March, 2016 by KDA Associates. The present value of the defined benefit obligation, and the related current service
cost, were measured using the Projected Unit Credit Method.
The amount recognized in the statement of financial position is determined as follows:
2016 2015
Present value of retirement benefit obligation 962,209 805,924
Interest cost 140,464 109,466
Current service cost 82,210 72,241
Benefits paid (172,157) (86,969)
Actuarial (gain) / loss due to change in experience 183,174 61,547
1,195,900 962,209

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RETIREMENT BENEFIT OBLIGATIONS (contd)
The principal actuarial assumptions were as follows:

Actuarial Method: Projected Unit Method
Discount rate: 14%
Rate of Salary escalation: 15% per annum
Retirement Age: 60 years
Pre-retirement mortality: A67/70 Ultimate
Withdrawal: Based on the average experience of other similar arrangements
Expenses: No explicit allowance.
2016 2015
13 DEFERRED INCOME AND ACCRUALS
Deferred income and accruals 25,528 72,985
Deferred income and accruals include government grants. The Company received government
interest grants in respect of CBN intervention loans from Guaranty Trust Bank Plc. and First Bank of
Nigeria Limited at a subsidized rate of 7% per annum. The loan from Guaranty Trust Bank had been
liquidated fully during the year. The interest grants are included under non-current liabilities and are
recognized in the income statement on a straight line basis over the tenure of the loans.

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2016 2015
14 PROFIT BEFORE TAXATION
The following items have been
charged/credited in arriving at
profit before tax:
Depreciation 1,990,705 2005,450
Allowance for bad and doubtful debts 71,636 48,963
Auditors' remuneration 15,000 15,000
Directors' emoluments:
Fees 18,666 12,618
Others 35,184 33,509
Finance cost 1,237,548 1,231,206
And crediting
Profit on disposal of fixed assets 6,199 846
Finance income 417,771 481,509
15 TAXATION
.1 Income Statement
Current company income tax 39,809 166,106
Education tax - 42,596
39,809 208,702
Deferred tax provision on origination and reversal of temporary differences 114,701 105,859
Tax charge to income statement 154,510 314,561
.2 Current tax liabilities

The movement in current tax balance is as follows: 2016 2015
At April 1 131,157 331,984
Charge for the year 39,809 208,702
Additional liability 349,698 -
520,664 540,686
Payment during the year (98,025) (409,529)
At March 31 422,639 131,157
The provision for income tax is based on the provision of the Companies Income Tax Act (LFN CAP 60) as
amended, while education tax is based on Education Tax Act No. 7 CAP E4 LFN, 2004.

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.3 Pioneer Status
The Company was granted a Pioneer Status Certificate for the new Mills E & F production plant in the
Apapa factory.
The required Certificate of Production Day, from the Industrial Inspectorate Department of the Federal
Ministry of Industry, Trade and Investment has been formally issued with the commencement date of
April 1, 2013 for the Pioneer Status Incentive. This will enable the company to enjoy a 5-year Tax
Holiday on the new plants.
The ERP of the Company has been designed to ensure separate accounting for the new plant. The new
plant is self-accounting in order to prepare an independent Income Statement and Statement of Financial
Position for its operations. The new plant was at the peak of its installed capacity during the year.
Turnover and Profit Before Tax relating to the new plant for the year ended March 31, 2016 were
N26,966,204,090 (2015: 20,822,230,232) and (N1,522,595,687) (2015: 609,006,567) respectively.
.4 Deferred Tax
Per income statement

Charge to income statement for the year 114,701 105,859
Per statement of financial position

The movement in deferred tax is as follows:
Deferred tax liability:
At April 1 3,517,377 3,411,518
Charge for the year 114,701 105,859
At March 31 3,632,078 3,517,377

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16 STATEMENT OF CASH FLOWS
The Statement of Cash Flows has been drawn up using the indirect method. Working capital comprises
inventories, receivables and current liabilities (excluding bank overdrafts). The cash flow from
investing activities relates to the net amount of investments and disposals whilst the cash position
consists of cash in hand and at bank.
2016 2015
.1 Cash flows from operating activities
Reconciliation of net profit to operating profit
before working capital changes
(Loss)/Profit before tax (2,869,342) 1,434,828
Adjustments for non-cash items:

Depreciation of property, plant and equipment 1,990,705 2,005,450
Profit on disposal of property, plant and equipment (6,199) (846)
Write-off of intangible assets 820 -
Amortization of intangible assets 9,277 4,793
Interest income (417,771) (481,509)
Interest expense 1,237,548 1,231,206
Net charge in retirement benefit obligations 222,674 181,707
Operating profit before working capital changes 167,713 4,375,629
.2 Working capital changes

Decrease/(increase) in inventories 6,960,384 (1,259,431)
(Decrease)/increase in deferred income and accruals (47,457) (210,274)
(Increase)/decrease in trade and other receivables 1,017,903 3,687,486
Increase/(Decrease) in trade and other payables 2,303,280 (494,766)
10,234,100 1,723,015
Cash generated from operations 10,401,823 6,098,644
17 SEGMENT REPORTING
The Company's business operating segments are identified by two factories located at Ikeja and Apapa.
The chief operating decision maker, who is responsible for allocating resources and assessing performance
of the operating segments, is the Board of Directors.
The Board reviews the Company's monthly financial and operational information in order to assess its
performance and allocate resources.
The chief operating decision maker assesses the performance based on operating profits for each operating
segment.

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.1 Revenue and Result

2016 2015
Ikeja Apapa Total Ikeja Apapa Total
Revenue 9,672,845 41,210,935 50,883,780 10,308,369 38,749,142 49,057,511
Cost of sales (9,121,090) (37,401,296) (46,522,386) (9,166,903) (32,387,075) (41,553,977)
Gross profit 551,755 3,809,639 4,361,394 1,141,466 6,362,067 7,503,534

Other income 52,112 105,858 157,970 167,026 65,778 232,804
Selling and admin expenses
and net interest expenses (968,608) (5,600,321) (6,568,929) (1,208,053) (4,343,760) (5,551,813)
Segment Operating
(Loss)/Profit (364,741) (1,684,824) (2,049,565) 100,439 2,084,085 2,184,525
2016 2015
.2 Revenue by geographical location of customers:
Domestic (within Nigeria) 50,883,780 49,057,511
Export (outside Nigeria) - -
50,883,780 49,057,511
All sales were made within Nigeria

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18 OTHER INCOME 2016 2015

Other income comprises the following:
Sale of by-products 80,703 80,232

Net gain on sale of property, plant and equipment 6,199 846
Raw wheat sales 44,108 -
Allowance no longer required 14,167 -
Sundry income 12,793 151,726
157,970 232,804
2016 2015
19 SHARE CAPITAL
Authorized
8,000,000,000 ordinary shares of 50k each 4,000,000 4,000,000
Issued and fully paid

7,930,197,658 (2015: 7,930,197,658) ordinary shares of 50k each 3,965,099 3,965,099
20 CHAIRMAN'S AND DIRECTORS' EMOLUMENTS,

PENSIONS AND COMPENSATION FOR
LOSS OF OFFICE
The remuneration paid to Directors was
.1 Fees:
Chairman 1,600 1,600
Other directors 17,066 11,018
18,666 12,618
.2 Fees and other emoluments disclosed above
include amount paid as:
Fees 18,666 12,618
Other emoluments 3 5,184 3 3,509
53,850 46,127

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2016 2015
.3 Number of directors (excluding the chairman) whose

emoluments were within certain ranges were: Number Number
N100,000 and above 13 13
.4 Waived emoluments
Number of directors who have waived their rights
to receive emoluments - -
Aggregate of those emoluments - -
.5 Pensions of directors and past directors Aggregate amount

of directors' or past directors or past directors' pensions` - -
Other pensions - -
.6 Compensation to directors for loss of office

Key management comprises the directors (executive and non-executive)
and the Chairman that form part of the leadership team
(Chief operating officers).
As directors - -
As executives - -
21 EMPLOYEES AND RELATED REMUNERATION

Number of employees in receipt of emoluments excluding
allowances were within the following ranges:
2016 2015
Number Number
N500,001 - N1,000,000 485 498
N1,000,001 - N1,500,000 89 87
N1,500,001 - N2,000,000 45 43
N2,000,001 - N2,500,000 73 68
N2,500,001 - N3,000,000 20 39
N3,000,001 - N3,500,000 33 30
N3,500,001 - N4,000,000 23 16
N4,000,001 - N4,500,000 17 13
N4,500,001 - N5,500,000 16 15
N5,500,001 - N6,000,000 11 10
N6,000,001 - Above 32 32
Total 844 851

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22 CONTINGENT LIABILITIES, GUARANTEES AND OTHER FINANCIAL COMMITMENTS

i Charges
The Company has loan facilities with First Bank of Nigeria Plc secured by All Assets Debenture.
ii Financial Commitments
The Directors are of the opinion that all known liabilities and commitments have been taken into
account in the preparation of the financial statements under review. These liabilities are relevant in
assessing the Company's state of affairs as at March 31, 2016.
iii Legal Charges

There is litigation against the Company as at 31 March, 2016 the outcome of which has not been
determined.
However, the directors, having sought legal advice of professional counsel are of the opinion that no
material liabilities will arise in the ordinary course of business. No provision was made in these
financial statements in that respect.
23 LOANS AND OTHER TRANSACTIONS FAVOURING DIRECTORS AND OFFICERS

a) During the year, the Company guaranteed no loan in favour of its Directors and Officers.
b) No loans were given to the Directors to purchase the Company's shares during the year.
24 CONTRAVENTIONS
In year 2016, the Company failed to meet the deadline for the submission of its 2nd quarter return for the
period ended 30 September, 2015, hence a penalty was paid for late submission. The penalty has been
included as administrative expenses.
25 COMPARATIVE FIGURES
Where necessary, comparative figures have been restated to conform with changes in presentation in
the current year.
26 EARNINGS PER SHARE

The Earnings Per Share (EPS) is calculated by dividing the profit attributable to ordinary Shareholders
by the number of ordinary shares issued as at March 31, 2016.

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27 APPROVAL OF FINANCIAL STATEMENTS

These financial statements were approved by the Board of Directors of the Company on Tuesday, 21,
June, 2016.
28 SIGNIFICANT JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In preparing its financial statements, the Company has made significant judgements, estimates and
assumptions that impact on the carrying value of certain assets and liabilities, income and expenses as
well as other information reported in the notes. The Company periodically monitors such estimates and
assumptions and makes sure that they incorporate all relevant information available at the date when
financial statements are prepared. However, this does not prevent actual figures differing from the
estimates.
The judgements made in the process of applying the Companys accounting policies that have the most
significant effect on the amounts recognised in the financial statements, and the estimates and
assumptions that have a significant risk of causing a material adjustment to the carrying amounts of
assets and liabilities within the next financial year are addressed below:
Revenue recognition
The Company makes provisions for trade discounts, volume rebates and charge back for product
returns allowed by the sale contracts when recognising the revenue derived from sales of its products.
Such deductions represent estimates, which are subject to judgements and assumptions based on past
experience as well as the Companys knowledge available at the time the estimate is made.
Allowance for doubtful receivables

The determination of the recoverability of the amount due from customers involves the identification of
whether there is any objective evidence of impairment. In cases where that process is not feasible, a
collective evaluation of impairment is performed. As a consequence, the way individual and collective
evaluations are carried out and the timing relating to the identification of objective evidence of
impairment require significant judgement and may materially affect the carrying amount of receivables
at the reporting date.

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Asset impairment tests

A financial asset or a group of financial assets, other than those categorised at fair value through profit
or loss, are assessed for indicators of impairment at the end of each reporting period. Impairment exists
only when the Company ascertains that a loss event affecting the estimated future cash flows of the
financial asset has occurred. It may not be possible to identify a single, discrete event that caused the
impairment and moreover to determine when a loss event has occurred might involve the exercise of
significant judgement.
The amount of impairment loss recognised for financial assets carried at amortised cost is the difference
between the assets carrying amount and the present value of estimated future cash flows, discounted at
the effective interest rate.
Net realisable value of inventories

Inventories are stated at the lower of cost and net realisable value. The cost of inventories is written
down to their estimated realisable value when their cost may no longer be recoverable, such as when
inventories are damaged or become wholly or partly obsolete or their selling prices have declined. In
any case, the realisable value represents the best estimate of the recoverable amount, based on the most
reliable evidence available at the reporting date and inherently involves estimates regarding the future
expected realisable value. The benchmarks for determining the amount of write-downs to net realisable
value include ageing analysis, technical assessment and subsequent events. In general, such an
evaluation process requires significant judgement and may materially affect the carrying amount of
inventories at the reporting date.
Deferred tax estimation

Recognition of deferred tax assets and liabilities involves making a series of assumptions. As far as
deferred tax assets are concerned, their realisation ultimately depends on taxable profits being available
in the future. Deferred tax assets are recognised only when it is probable that taxable profits will be
available against which the deferred tax asset can be utilised and it is probable that the entity will earn
sufficient taxable profit in future periods to benefit from a reduction in tax payments. This involves the
Company making assumptions within its overall tax-planning activities and periodically reassessing
them in order to reflect changed circumstances as well as tax regulations. Moreover, the measurement
of a deferred tax asset or liability reflects the manner in which the entity expects to recover the assets
carrying value or settle the liability.

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Actuarial assumptions on defined benefit retirement plans

Accounting for defined benefit plans may be complex because actuarial assumptions are required to
measure the obligation and the expense, with the posibility that actual results differ from the assumed
results. These differences are known as actuarial gains and losses. Defined benefit obligations are
measured using the Projected Unit Method, according to which the Company has to make a reliable
estimate of the amount of benefits earned in return for services rendered in current and prior periods,
using actuarial techniques.
29 NEW ACCOUNTING STANDARDS ISSUED BUT NOT YET ADOPTED

The following new standards, amendments and interpretations have been issued by the International
Accounting Standards Board (IASB) but are not yet effective for the financial year beginning 1 April,
2015 and have not been earlier adopted by Honeywell Flour Mills Plc. (the list does not include
information about new pronouncements that affect interim financial reporting or first-time adopters
of IFRS since they are not relevant to the Company).
IFRS 14 Regulatory Deferral Accounts

IFRS 14: Regulatory deferral Accounts permits an entity which is a first-time adopter of International
Financial Reporting Standards to continue to account, with some limited changes for regulatory
deferral account balances in accordance with its previous GAAP, both on initial adoption of IFRS
and subsequent financial statements. Regulatory deferral account balances and movements in them,
are presented separately in the statement of financial position and statement of profit or loss and other
comprehensive income, and specific disclosures are required.
The objective of IFRS 14 is to specify the financial reporting requirements for regulatory deferral
account balances that arise when an entity provides goods or services to customers at a price or rate
that is subject to rate regulation.
IFRS 14 is designed as a limited scope Standard to provide an interim, short-term solution for rate-
regulated entities that have not yet adopted International Financial Reporting Standards (IFRS). Its
purpose is to allow rate-regulated entities adopting IFRS for the first-time to avoid changes in
accounting policies in respect of regulatory deferral accounts until such time as the International
Accounting Standards Board (IASB) can complete its comprehensive project on rate regulated
activities.

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Where an entity elects to apply it, IFRS 14 is effective for an entitys first annual IFRS financial
statements that are for a period beginning on or after 1 January, 2016. The standard can be applied
earlier, but the entity must disclose when it has done so.
IFRS 15: Revenue from Contracts with Customers

IFRS 15 specifies how and when an IFRS reporter will recognise revenue as well as requiring such
entities to provide users of financial statements with more informative, relevant disclosures. The
standard provides a single, principles based five-step model to be applied to all contracts with
customers.
IFRS 15 was issued in May 2014 and applies to an annual reporting period beginning on or after 1
January, 2017.
The objective of IFRS 15 is to establish the principles that an entity shall apply to report useful
information to users of financial statements about the nature, amount, timing, and uncertainty of
revenue and cash flows arising from a contract with a customer. (IFRS 15:1) Application of the
standard is mandatory for annual reporting periods starting from 1 January, 2017 onwards. Earlier
application is permitted.
IFRS 15 Revenue from Contracts with Customers applies to all contracts with customers except for:
leases within the scope of IAS 17 Leases; financial instruments and other contractual rights or
obligations within the scope of IFRS 9 Financial Instruments, IFRS 10 Consolidated Financial
Statements, IFRS 11 Joint Arrangements, IAS 27 Separate Financial Statements and IAS 28
Investments in Associates and Joint Ventures; insurance contracts within the scope of IFRS 4
Insurance Contracts; and non-monetary exchanges between entities in the same line of business to
facilitate sales to customers or potential customers.

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Amendments to IAS 16 and IAS 38: Clarification of Acceptable Method of

Depreciation and Amortization
The requirements of IAS 16 are amended to clarify that a depreciation method that is based on
revenue that is generated by an activity that includes the use of an asset is not appropriated. This is
because such methods reflect a pattern of generation of economic benefits that arise from the
operation of the business of which an asset is part, rather than the pattern of consumption of an assets
expected future economic benefits.
The requirements of IAS 38 are amended to introduce a rebuttable presumption that a revenue-based
amortisation method for intangible assets is inappropriate for the same reasons as in IAS 16.
However, the IASB states that there are limited circumstances when the presumption can be
overcome:
The intangible asset is expressed as a measure of revenue (the predominant limiting factor inherent in
an intangible asset is the achievement of a revenue threshold); and
it can be demonstrated that the revenue and the consumption of economic benefits of the intangible
asset are highly correlated and that the consumption of the intangible asset is directly linked to the
revenue generated from using the asset).
Guidance is introduced into both standards to explain that expected future reduction in selling prices
could be indicative of a higher rate of consumption of the future economic benefits embodied in an
asset.
The amendments are effective for annual periods beginning on or after 1 January, 2016. Earlier
application is permitted.
Amendment to IFRS 7 Disclosures- Offsetting Financial Assets and Financial Liabilities

The IFRS is part of the IASBs project to replace IAS 39. IFRS 9 addresses classification and
measurement of financial assets and replaces the multiple classification and measurement models in
IAS 39 with a single model that has only two classification categories: amortised cost and fair value.
Effective for annual periods beginning on or after 1 January, 2016.

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VALUE ADDED STATEMENT FOR THE YEAR ENDED MARCH 31, 2016
2016 2015
In thousands of Naira % %
Revenue 50,883,780 49,057,511
Other revenue 157,970 232,804
51,041,750 49,290,315
Bought in goods
and services (49,177,687) (43,009,028)
VALUE ADDED 1,864,063 100 6,281,287 100
APPLIED AS FOLLOWS:
1 To pay employees
Salaries and wages, pension
and social benefits 1,505,152 81 1,609,803 25
2 To pay providers of funds

Finance expenses 1,237,548 66 1,231,206 20
3 To pay government
Income and education taxes 39,809 2 208,702 3
4 To provide for maintenance and expansion of assets

Depreciation 1,990,705 107 2,005,450 32
Deferred tax 114,701 6 105,859 2
Retained profit (3,023,852) (162) 1,120,267 18
VALUE ADDED 1,864,063 100 6,281,287 100
Note: Value added is the wealth created by the efforts of the company and its employees and its
allocation between employees, shareholders, government and re-investment for the future
creation of further wealth.

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FINANCIAL SUMMARY FOR FIVE YEAR ENDED MARCH 31, 2016
IFRS
2016 2015 2014 2013 2012
STATEMENT OF FINANCIAL POSITION
Property, plant and equipment 53,757,796 49,282,429 36,085,450 34,969,128 29,014,121
Intangible assets 31,131 36,846 12,332 15,904 198

Inventories 5,586,084 12,546,468
12,12,546,468 11,287,037 11,287,037 10,0010,009,275
9,275 4,931,032
4,931,032
Trade and other receivables 5,874,818 2,187,332
1,169,430 5,874,818
6 ,8 68,962 6,868,962 10,126,471
10,126,471
Cash and bank balances 3,890,369 10,570,802
15,502,135 3,890,369 3,574,209
10,570,802 3,858,456
3,574,209 3,962,142
3,858,456
Total assets 76,046,576 67,943,444 63,830,439 55,437,478 47,930,278
Current liabilities (44,213,225) (31,860,220) (28,059,339) (27,503,156) (21,798,567)
Non-current liabilities (15,470,752) (15,767,390) (15,165,852) (9,381,239) (9,115,697)
Total net assets 16,362,599 20,315,834 20,605,248 18,553,083 17,016,014
Share capital 3,965,099 3,965,099 3,965,099 3,965,099 3,965,099

Share premium 6,462,041
6,462,041 6,462,041 6,462,041 6,462,041
6,462,041 6,462,041
6,462,041
Retained earnings 5,935,459 9,888,694 10,178,108 8,125,943 6,588,874
Capital employed 16,362,599 20,315,834 20,605,248 18,553,083 17,016,014
STATEMENT OF COMPREHENSIVE
INCOME
Revenue 50,883,780 49,057,511 55,084,305 45,709,382 38,052,227
Profit before tax & after exceptional item (2,869,342) 1,434,828 4,237,432 3,814,599 3,758,735
Taxation (154,510) (314,561) (885,868) (971,079) (970,960)
Profit after tax (3,023,852) 1,120,267 3,351,564 2,843,520 2,787,775
Transfer to revenue reserve (3,023,852) 1,120,267 3,351,564 2,843,520 2,787,775
Profit attributable to:

Equity shareholders (3,023,852) 1,120,267 3,351,564 2,843,520 2,787,775
Earnings per 50k share [k] (38.13) 14.13 42.26 35.86 35.15
Net assets per 50k share [k] 206.33 256.18 259.83 233.95 214.57
NOTE: Earnings and net assets per share are based on 7,930,197,658 ordinary shares of 50k each and profit
after tax as at the date of these financial statements.

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SHAREHOLDERS
INFORMATION
List of Key Distributors 92-93
Unclaimed Dividends 94
Share Capital History 95
Proxy Form 96
Electronic Delivery Mandate Form 98

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KEY DISTRIBUTORS
NAME REGION LOCATION NAME REGION LOCATION

A K Maikwai Nigeria Ltd. North Katsina Dekem Trading Enterprises Ltd. North Abuja
Abdulahi Salah North Sokoto De-Tofola Nigeria Ltd. Lagos Sango
Abdullahi Murtala Kano North Kano Doo & Co. East Benin
Abdullahi Yusuf North Yola Duru Stainless Business Enterprises North Jos
Abinukolade Global Ventures Lagos Ojodu E.H. Okika Nigeria Limited North Gboko
Abiola Aramide Olaoluwa Nig. Ent. West Ibadan Ebenezer Dairo Enterprises. Lagos Mushin
Abubarka Arzika & Sons North Kebbi Ejiofor Ent Nig. East Benin
Adamu Abdullahi North Gombe Eleven Sixteen Ltd. Lagos Agege
Ade Distribution & Invest Co Ltd. Lagos Ijebu Ode Executive Bread & Confectionary Nig. Ltd. North Kano
Adebiyi Merchants Stores Lagos Agege Ezeh Chief East Onitsha
Adejumo Nigeria Enterprises West Ilorin F. Adunni Nigeria Enterprises Lagos Agege
Ade-Ofeek Nigeria Enterprises West Ibadan Faith Foods And Confectioneries East Port Harcourt
Adeowo Nigeria Ltd Lagos Mushin Fantazia Fast Food Ltd. East Warri
Adeshina Alhaja Lagos Itire Fastizers Food & Confectionery Ltd. Lagos Igbesa
Adet Enterprises North Jos Favoured Success Multibiz. North Abuja
Adeyemo Olusola & Associates West Ibadan Fermadons Enterprises Lagos Idi Iroko
Adidot Nigeria Enterprises Lagos Ijebu Ode Frandnivan Ventures. East Benin
Aduwa Stores North Gusau Gambo Danbala Lambu North Kano
Agozie Chibuzor George West Ondo Gari Garbas North Kano
Ahajas Nig Ltd North Gombe Genesis Foods Nigeria Limited East Port Harcourt
Alh Ali Modu Soja North Maiduguri Geymay Ind. Ltd. East Aba
Alh. Bello Danhaja North Sokoto Gilbest Confectionery Nig. Ltd. East Port Harcourt
Alhaji Abdulkadir Hali Maikeke & Sons North Sokoto God'S Own Ventures West Akure
Alhaji Adam Ibrahim North Maiduguri Great Hope Universal Ventures Lagos Agege
Alhaji Mukhtar Nayaya North Jos Habibu Goron Duma North Kano
Ali Hassan North Maiduguri Haruna Maigishi North Birni Kebbi
Amadu Yusuf North Gombe Haske & Sons General Inv. Nig. Ltd. North Bauchi
Amazing Wonders Nigeria Ltd. Lagos Ketu Heron Ventures Lagos Abeokuta
Amen'S Mart Global Ventures Lagos Akute His Favour Commodity Stores Lagos Abeokuta
Amudeson Nig. Enterprises East Enugu Ibe God Enterprises Ltd. East Owerri
Aolat Adefunke Nig. Ltd. West Oshogbo Ibrahim Hamza North Gombe
Asalam Stores Ventures Lagos Abeokuta Ibrahim Sulu Oloje (Alhaji) West Lokoja
Atoyen Ventures Lagos Ikeja Ibrahim Usman Enterprises North Sokoto
Aunty Gina Nig Enterprises East Warri Ici Holdings Limited East Onitsha
Aznof Perfect Stores Ventures Lagos Ikorodu Ifeanyichukwumeh Venture East Enugu
B. Zion Enterprises Lagos Sango Imperial Bakeries Nig. North Abuja
Badamosi Yahaya North Minna Isiaku Muhammed North Kaduna
Bala Yusuf Usman North Bauchi J C Joseph Industries Limited East Aba
Bashir Yusuf Angale & Sons. North Kano J.B. General Enterprises Jibia North Katsina
Bekdat Ventures. North Abuja J.B.Oyesomi & Sons Nig.Ltd. East Benin
Bernard Eze & Sons East Benin J.C.Anugwu & Sons Nig.Ltd. East Onitsha
Blessed Chidi Martin Chemical Coy. East Enugu Joachin Ikechukwu Ezebube East Benin
Blessed Chima Umeh Enterprises East Enugu Jonhec Nig. Ltd. North Minna
Blessed Consumables Enterprise North Abuja Kabiru Ahmed Dokoro North Gombe
Blessed Obrown Ent. Nig. Ltd. North Abuja Kabiru Shuaibu Dansarai North Kano
Bofik Nigeria Ltd. Lagos Agege Kamchizy Associate East Onitsha
Carbo Nig Enterprises West Ibadan Kayjay Zenith Ltd. Lagos Ajah
Channel Of Blessing Ventures Lagos Iddo Kazmoha Investment Resources Ltd. Lagos Iddo
Chidex Frontline Enterprises East Aba Kubrat Sayed & Sons Nig.Ltd. West Ibadan
Chijioke Ofonyelu West Akoko-Ikare Laji Ventures Lagos Trade Fair
Chimaco & Brothers Enterprises East Owerri Lasol Nigeria Ltd. Lagos Iddo
Chisco Best West Ondo Lawali Sanni Gusau Alh. North Gusau
Christaypej Nig. Ent. Lagos Apongbon Legacy Bakery Ltd. West Lokoja
Cleason Nigeria Enterprises North Makurdi Lolly Global Stores. Lagos Mushin
Cossy Bros Intern Ltd Lagos Agege M. O Nnaji Industry Ltd. East Aba
Crunchies Fried Chicken Limited East Aba Mackensen Nig. Ltd. Lagos Ejigbo
D' Abigails Nig Ltd. Lagos Yaba Mag3 Nig.Ltd. Lagos Ikeja
Daily Manna Global Ind. Ltd. East Aba Mario Barns Ltd. East Port Harcourt
Damilek Integrated Services Ltd. East Port Harcourt Mbonu Chief) East Onitsha
Danladi Muhammed North Maiduguri Medan Nigeria Enterprises East Uyo

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KEY DISTRIBUTORS
NAME REGION LOCATION NAME REGION LOCATION

Meneshad Services Ltd. East Warri Rehoboth Integrated Services East Port Harcourt
Merciful Business Lagos Mushin Royal Gate Company Limited Lagos Abeokuta
Michelle Edmund Ventures West Ibadan S O Omilabu & Sons Ltd. Lagos Apongbon
Mimza General Enterprises. North Kano S R S Adeshina Nig Ltd. Lagos Surulere
Muhammed Alli Magaru & Sons North Minna Sabo Moh'D Enterprises North Gombe
Muh'D Nafiu Adamu Kanulle North Maiduguri Safeway Resources Int. Ltd. East Aba
Murtala Abdullahi Trading North Kaduna Salisu Maigishiri Markafi North Kaduna
Musa Muhammed Director North Kano Salmanu Adamu North Kano
Naizan Nigeria Limited North Gombe Samtina Ventures West Oshogbo
Namadi Inuwa Enterprises North Kano Santa Maria Ent. Ltd. East Abakaliki
Nekvine Ventures Lagos Trade Fair Savana Global Bakery (Flour) North Jalingo
New Gaskiya North Kano Saysuraj Enterprises North Kaduna
New Life Ventures Lagos Iddo Shagumba Ventures North Katsina
Ngaloma General Enterprises North Maiduguri Shield Ventures Lagos Sagamu
Niasee Ventures Lagos Ikorodu Solak Industries Ltd. Lagos Agege
Nitty Dol Ventures Limited Lagos Agege Sopul-C Enterprises North Abuja
Nnemelu J. C. East Onitsha Sundry Foods Ltd. East Port Harcourt
Nwaudo Investment Nig. Ltd. North Makurdi Sylmec Ventures Ltd. North Makurdi
Obi Okoye East Aba Tadex Bakery Industry Ltd. Lagos Sagamu
Odilamma Enterprises Nigeria East Owerri Timmy BakeryLagosSagamu
Ogene Concerns Limited East Onitsha Trusth Milk Special Bread North Gombe
Ogestan Ventures East Benin Tukur Sabaru Alh. North Sokoto
Ola Jesu Nig Ltd. Lagos Sagamu Ugo Best Business Ass. Nig. Ltd. North Zaria
Oladejo & Sons Nigeria Ent. Lagos Alagbado Ugwu Sylvester Lagos Isolo
Olayiwola Stores Jos North Jos Umar Musa Bakery North Kaduna
Oloriegbe Nigeria Limited. West Ilorin Umaru Ladan Alh. North Bauchi
Oluwasesan Sose Enterprises West Ibadan Uniqueayos Ventures Lagos Mushin
Oni Stores Lagos Agege Usezor Integrated Services Ltd. North Abuja
Palma Seaport Ltd. East Enugu Uwana Ventures. Lagos Ijesha-Tedo
Progress Confectionery Ventures East Anambra Vincent Muoneke East Benin
Quad & Kay Ventures Lagos Mushin W. J. Onyema Supply Company Ltd. West Akoko-Ikare
Queen Of All Hearts Ltd. Lagos Ikeja Wisdom Divinity Ltd. Lagos Ifo
Queensmeal Foods Ltd. Lagos Ajangbadi Yodbon Ventures Lagos Ogba
Raji Opeyemi Industries Lagos Ikotun Young Bukason Comm. Enterp. Ltd. East Onitsha
Rameses Nig. Ltd. Lagos Festac Zaifa Agencies Limited East Onitsha
Rasaki Hassan Alh. Lagos Ajangbadi Zamani Special Bread North Yola

93
94
Some dividend warrants have not been presented to the Bank for payment while others have been returned to
the Registrar as unclaimed because the address could not be traced.
& Accounts
Annual Report
2016
The Unclaimed Dividend as at July 26, 2016 is as analysed below.

UNCLAIMED DIVIDENDS
2010 2011 2012 2013 2014 2015

Unclaimed Dividend Unclaimed Dividend Unclaimed Dividend Unclaimed Dividend Unclaimed Dividend Unclaimed Dividend

Total
Number of Number of Number of Number of Number of Number of Amount
Dividend Range Amount Amount Amount Amount Amount Amount
Shareholders Shareholders Shareholders Shareholders Shareholders Shareholders
N000 N000 N000 N000 N000 N000 N000
Above N1,000,000 - - - - 2 2,221 1 1,060 2 2,639 3 35,634 41,555
N100,000 - N1,000,000 1 233 6 1,010 6 951 12 3,268 15 2,859 4 757 9,078
N50,000 - N99,999 7 539 6 415 7 493 14 1,006 28 2,096 6 417 4,967
N10,000 - N49,999 22 519 37 570 51 924 106 2,237 153 2,959 49 1,061 8,269
N1,000 - N9,999 478 1,033 983 1,849 1,128 2,364 1,570 3,479 1,705 4,200 523 1,461 14,386
Less than N1,000 13,437 2,908 14,130 3,249 15,105 3,990 15,637 4,351 16,304 4,817 20,029 2,535 21,849
Total 13,945 5,232 15,162 7,092 16,299 10,943 17,340 15,401 18,207 19,569 20,614 41,866 100,104
Total Declared Dividend 1,031,000
872,322 1,189,530 1,268,831 1,348,134 396,510 6,106,326
in Years
% of Unclaimed Dividend 0.6% 0.7% 0.9% 1.2% 1.5% 10.6% 1.6%
Detailed list of Unclaimed Dividends can be viewed or downloaded from the Companys website at
www.honeywellflour.com
RC 55495
SHAREHOLDERS INFORMATION
RC 55495
2016
Annual Report
& Accounts SHAREHOLDERS INFORMATION
SHARE CAPITAL HISTORY
Year Authorized (N'000) Issued & Fully Paid-up (N'000)

Consideration
Increase Cumulative Increase Cumulative
1990 - 10,000 - 2 Cash @ N1 each
1991 - 10,000 - 2 Cash @ N1 each
1992 - 10,000 - 2 Cash @ N1 each
1993 - 10,000 - 2 Cash @ N1 each
1994 - 10,000 - 2 Cash @ N1 each
1995 40,000 50,000 49,998 50,000 Cash @ N1 each
2001 160,000 210,000 160,000 210,000 Cash @ N1 each
2003 790,000 1,000,000 790,000 1,000,000 Cash @ N1 each
Acquisition of Honeywell
2008 1,000,000 2,000,000 999,999 1,999,999 Superfine Foods Limited
2008 - 2,000,000 - 1,999,999 Share Split of N1 to N0.50
2008 2,000,000 4,000,000 1,500,000 3,499,999 Bonus Issue of 3 to 4 shares
- 4,000,000 465,100 3,965,099 Public Issue @ N8.50 each

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PROXY FORM
HONEYWELL FLOUR MILLS PLC

7TH ANNUAL GENERAL MEETING TO BE
HELD AT 11.00 A.M
ON TUESDAY SEPTEMBER 20 2016
AT THE CIVIC CENTRE,
OZUMBA MBADIWE STREET,
VICTORIA ISLAND, LAGOS.
(Name of Shareholder in block letters)

The undersigned, being a member/members of the above-Named RESOLUTION FOR AGAINST
Company hereby appoint the Chairman of the meeting Or failing
him....................................................................................................... 1. To adopt the Annual Report and Accounts
..............as my/our Proxy to vote me/us and On my/our behalf at the 2a. To re-elect the following Directors:
Annual General Meeting of the Company to be held on September 20, Mr. Obafemi Otudeko
2016 and at any adjournment thereof." Mr. Olanrewaju Jaiyeola
Unless otherwise instructed, the proxy will vote or abstain from Mr. Benson Evbuomwan
Voting as he/she thinks fit. Mr. Rotimi Fadipe
Dated this..............................day of.............................................2016 Mr. Akinsoji Akintayo
Signature............................................................................................ 2b. To elect Mrs. Oluseye Sandey as Director
3. To authorize the Directors to fix Auditors
Notes Remuneration.
1.Please sign this proxy card and send it to reach the Registered office 4. To appoint members of the Audit Committee
of the Company or its Registrars not less than 48 Hours before the time
fixed for the meeting.
2.If executed by a corporation, the proxy card should be Sealed with Please indicate with an "X" in the appropriate section how you wish your votes to
the common seal. be casted on resolutions set above. Unless otherwise instructed, the proxy will
vote or abstain from voting at his/her discretion.
3.This proxy card will be used both by show of hands,
And in the event of a poll being directed or demanded
Before posting the above form please tear off this part and retain it for admission to the meeting
ADMISSION FORM
HONEYWELL FLOUR MILLS PLC (RC55495)
7TH ANNUAL GENERAL MEETING TO BE HELD at Civic Center Ozumba Mbadiwe street, Victoria Island Lagos on Tuesday
September 20, 2016 at ll a.m
Name of Shareholder*....... .........................................................................................................................................

Name of Proxy*...........................................................................................................................................................................
If you are unable to attend the meeting
A member (shareholder) entitled to attend and vote is entitled to appoint one or more proxies to attend and vote instead of him. A Proxy
need not be a member. The above proxy form has been prepared to enable you to exercise your right to vote.,
Important
Please insert your name in BLOCK CAPITALS on both proxy and admission forms where asterisked. Insert the name of any person
where a member of the Company or not, with the exception of the Company who will attend the meeting and vote on your behalf.

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ELECTRONIC DELIVERY MANDATE FORM
I / We/ Chief/ Dr/ Mr/ Mrs.
Title:
Name:
Address:
hereby agree to the delivery of Annual Report and other statutory documents of
Honeywell Flour Mill Plc to me/us via electronic mode:
The Company should forward the materials to the email address stated below:
e-mail address : ...............................................................................................
Signature : ...............................................................................................
The Registrar
First Registrars and Investor Services Limited
Plot 2, Abebe Village Road
Iganmu
Lagos.

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& Accounts

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Annual Report
& Accounts
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& Accounts
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2016 HFMP Annual Report&Accounts

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2016

Honeywell Flour Mills Plc.

Notice of Annual General Meeting 4

Corporate Profile 6-8

Directors and other Corporate Information 9-10

Honeywell Flour Mills Plc.

Per 50k share data

Stock Exchange Information

Stock Exchange quotation at

Number of Shares Issued (in millions) 7,930 7,930 -

Honeywell Flour Mills Plc.

Notice of Annual General Meeting

Date: Tuesday 20 September, 2016

Venue: Civic Centre

The following will be transacted at the meeting:

Right of Shareholders to Ask Questions

BY ORDER OF THE BOARD

Oluwayemisi Busari (Mrs.)

4 Honeywell Flour Mills Plc.

Honeywell Flour Mills Plc.

OUR CORE VALUES

These products include:

Honeywell Flour Mills Plc.

CORPORATE SOCIAL RESPONSIBILITY

Honeywell Flour Mills Plc.

(b) Ikeja Factory

Honeywell Flour Mills Plc.

Honeywell Flour Mills Plc.

BOARD OF DIRECTORS PROFILE 17-20

THE REPORT OF THE DIRECTORS 21-30

Honeywell Flour Mills Plc.

BUSINESS REVIEW CHAIRMANS STATEMENT

Dr. Oba Otudeko, CFR

Honeywell Flour Mills Plc.

BUSINESS REVIEW CHAIRMANS STATEMENT contd

Honeywell Flour Mills Plc.

BUSINESS REVIEW CHAIRMANS STATEMENT contd

Honeywell Flour Mills Plc.

BUSINESS REVIEW CHAIRMANS STATEMENT contd

Honeywell Flour Mills Plc.

Dr. Oba Otudeko, D.SC. (Hon.) CFR Mr. Olanrewaju Jaiyeola

Dr. Nino Albert Ozara Dr. Teddy Ngu

Honeywell Flour Mills Plc.

Mr. Benson Evbuomwan Dr. Raymond Zoukpo

Mr. Andrew Smith-Maxwell Mrs. Oluseye Sandey

Honeywell Flour Mills Plc.

He was formerly the Commercial Director at the

Mr. Alan Palmer

Dr. Nino Albert Ozara joined Honeywell Flour

He currently serves as Executive Director,

He is also a Director of First Bank of Nigeria Limited and

Dr. Teddy Ngu

Honeywell Flour Mills Plc.

Wonuola Adetayo (Mrs)

A graduate of Chemistry from the University of Ibadan,

Dr. Raymond Zoukpo Andrew Smith-Maxwell

Benson holds a Bachelors degree in Pharmacy from

Mrs Oluseye Sandey

She brings to the Board over 30 years of experience in auditing,