Guinness stocks have reported an abysmal -33.7% returns on investment year to date at the close of market yesterday, continuing a bullish trend seen since Diageo Plc, owners of Guinness Overseas Ltd, the parent company of Guinness Nigeria Plc announced its decision to reverse its planned acquisition of additional 15.7% equity stake in the Nigerian operation.
Many investors saw that decision as a show of lack of confidence in Guinness Nigeria’s profitability and given the harsh economic conditions, the company has seen its fortunes in the stock market dip from bad to worse.
The year-to-date investments returns was -18.6% just before the announcement was made, -21.1% when its woeful first quarter results were released and now -33.7%.
The company however remains optimistic that the company would come through this difficult period and return to profitable ways due to its right strategy. Encouraging shareholders to endure with the company, Sesan Sobowale, the Director of Corporate Relations, told Vangaurd that although “Guinness Nigeria is …. feeling the effect of the operating environment, [it] believes that [it] has the right strategy to reposition the business and return it to profitability as soon as possible”
Signifying areas of hope, Sobowale mentioned that the company’s unrivalled portfolio of beer, soft drinks and spirits as well as their focus on reducing operational cost would mean that they become a profitable venture once more sooner rather than later.