Key Highlights
- Revenue increased 9%.
- Cost of sales increased 15%.
- Marketing, Distribution & Admin expenses increased 5%.
- Operating profit declined 15%.
- Expands operations to wines and spirits category.
Nigeria’s brewing giant, Nigerian Breweries Plc, has announced its audited results for the period ended 31st December 2023, revealing a net loss of N106 billion during the year, largely induced by the impact of the devaluation of the naira on its foreign exchange transactions.
The audited results which were released to the Nigerian
Exchange Limited (NGX), indicated that revenue rose by 9% versus the prior
period of 2022. The company also reported an operating profit of N44.5 billion
in 2023. However, this was lower by 15% compared to the corresponding period in
the previous year, citing increase in input cost, a one-off reorganisation cost
and other economic pressures as causes of the decline.
Speaking on the announcement, Mr Hans Essaadi, Managing
Director/CEO, Nigerian Breweries Plc said: “The business performance of 2023
reflects the challenging economic environment in Nigeria. These severe economic
conditions include persistent cash scarcity, removal of fuel subsidies
resulting in a notable surge in energy cost, naira devaluation, foreign
exchange scarcity, and continued challenged consumer spending in the midst of
high inflation.
Despite these challenges, the business recorded some
progress, delivering a 9% growth in revenue aided by a positive price mix.
Unfortunately, our efforts were undermined by the impact of the devaluation of
the naira, causing a N153 billion loss on foreign exchange transactions.”
The company revealed that its reaction to the challenges
presented by the tough economic terrain was centered around reducing risk to
the business by focusing on a positive price mix, efficient sales operations,
strong and aggressive cost management, and other efficiency measures.
“Going into the new year, we are conscious of the continued
severe macro-economic challenges – rising inflation, heightening operating
costs and pressured consumer income spend. However, we believe the challenges
of 2023 have laid the groundwork for opportunities that would lead to value
creation for all our stakeholders”, Managing Director/CEO, Nigerian Breweries
Plc, Mr Essaadi said.
One of these opportunities is the acquisition of an 80%
business stake in Distell Wines and Spirits Limited, a local business in the
wines and spirits category, and an exclusive right to import all Heineken
Beverages wines, spirits, and ciders brands from South Africa, including a
license to market and distribute all the products in Nigeria, as well as to
produce any of the imported brands locally.
“This acquisition is part of efforts to provide access to a
complementary multi-category portfolio of fast-growing wines and spirits brands
and capture significant growth opportunities in the wines and spirits segment
of the beverages industry”, he explained.
He added that the “Board and Management will ensure that the
Company builds on its more than 77 years’ experience of operating in Nigeria to
cope with current realities. The Company will continue to be resilient and
forward-thinking leveraging our broad portfolio, strong supply chain footprint
and passionate workforce driving long-term value creation for its shareholders
and other stakeholders.”
0 comments:
Post a Comment