Nigerian Breweries reported an 11% rise in earnings per share for the 9 months ended September 2014. Here are the key highlights.
- On a year on year basis revenues was higher by 2.3% in the 9 months this year. This was mostly due to the stronger Q1 and Q2 this year.
- Margins also improved on a year on year basis for the company as they were able to keep operating expenses relatively flat. This was a major factor in the 11% growth in earnings per share year on year.
- However, things are a bit different on a quarter on quarter basis. Between July and September 2014 saw revenues of N53billion compared to N75billion the quarter before and N56billion in 2013 Q3.
- Since I started tracking in 2012, the company has had a weak third quarter. However, revenues had not dropped below N56billion in the last two years (for Q3 only)
- The impact of the drop in revenues this quarter compared to same quarter in prior years did not affect margins as the company held down cost of sales and operating profits.
- Nigerian Breweries debt soared back to N45billion from the N9billion it closed at the end of 2012. It agreed a N60billion financing package back in 2011 which it continues to draw
- Q4 will be an important reporting period for the company as they will need to ensure revenues are more than N75billion to beat 2013 revenues. It also has to post a profit after tax of over N16billion to beat prior year’s earnings.
- Nigerian Breweries still has a price earnings multiple of about 27.7x. It’s share price rose 0.62% to N170 at the close of trading October 23rd as Investors reacted tepidly to the result.