Nigerian Breweries Annual Profit Leaps 72% as Sales Hit All-Time High

Nigeria’s biggest beer-maker Nigerian Breweries reported, for the 2021 financial year, a post-tax profit 72 per cent higher than what it posted a year earlier after sales climbed to peak level since the company started bottling beer in June 1949.

Bottomline got a spur from a 30 per cent rise in revenue, which grew to N437.3 billion from N337 billion, according to the brewer’s audited earnings report published by the Nigerian Exchange on Friday.

The company’s share price jumped 2 per cent higher at 12:31 WAT on Lagos’ Custom Street on Friday, following the news.

But a dramatic surge in cost of sales and operating expenses plunged Nigerian Breweries to its second weakest annual profit since at least 2013 even though none of the yearly revenues for those eight years was any way near that of the period under review.

That left profit margin, which depicts how much of the company’s revenue has turned into profit, at just 2.9 per cent. The figure compares with the 16 per cent margin reported in 2014, when revenue was much lower, standing at N266.4 billion.

A spokesperson for Nigerian Breweries did not immediately respond to PREMIUM TIMES’ call for comment.

Profit Before Tax came to N23.7 billion, more than two fold bigger than what the firm reported the year before while after-tax profit swelled to N12.7 billion from N7.4 billion.

Liquor powerhouse Heineken Brouwerijen B.V., which owns more than 165 breweries in over 70 countries, wields the biggest stake in Nigerian Breweries, controlling 38.1 per cent of the outstanding shares, while Distilled Trading International B.V. and Stanbic Nominees Nigeria Limited come in tow on the brewer’s ownership pecking order at 15.5 per cent and 12 per cent stakes respectively.

At the moment the biggest brewer in Europe, Heineken, through its nominee Raysun Nigeria Limited, holds an 85 per cent interest in Uyo-based Champion Breweries, and has mounted a mandatory takeover bid to buy the rest 15 per cent shareholding from Champion Breweries’ minority stockholders at a premium-included price of N2.65 per share compared to a market price of N2.05 as of 13.07 WAT on Friday.

February 18, 2022