The year-on-year comparison revealed staggering increases of 6,757.9 percent, 3,997.4 percent, and 3,336.01 percent for Cadbury, Nestlé, and Lafarge Africa respectively.
Finance costs encompass expenses, interests, and charges associated with borrowing funds for asset acquisition or development.
Eleven manufacturing firms collectively witnessed a noteworthy spike, amounting to N550.2 billion in Q1, indicating a striking 771 percent surge from N63.18 billion in the corresponding period of the prior year.
The surge in finance costs can be attributed to factors such as foreign exchange losses and escalating interest rates, leading to declining profits or substantial losses despite commendable operational performances among some companies, according to Ayorinde Akinloye, an investor relations analyst based in Lagos.
The Central Bank of Nigeria's consecutive rate hikes, reaching 24.75 percent by March 2024, alongside tightening monetary policies, contributed to the escalation in borrowing costs, with banks adjusting interest rates accordingly.
This dynamic, coupled with reduced working capital for manufacturers, has led to diminished capacity utilization and operational challenges within the manufacturing sector.
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