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NB Plc Vs Guinness Plc: The beer review

The risk to these companies is the shrinking market as prices cannot be cut forever; thus, productivity improvements to reduce costs will be the differentiator.



The Nigerian beverage market has been dominated by Nigerian Breweries Plc (NB Plc) and Guinness Plc for decades.

Nigeran Breweries Plc, a subsidiary of Heineken International was the pioneer and began brewing and marketing beer in 1949 (yes, before there was Nigeria). Nigeria also has some history with Guinness Plc, a subsidiary of Diageo as Nigeria was the first location to be selected outside Great Britain to brew the stout lager in 1963.

NB Plc has nine breweries across Nigeria with two malting plants, while Guinness has five brewing plants.

This picture has since changed as Anheuser-Busch In Bev (AB InBev), the world’s largest beer producer, entered Nigeria in 2016 as International Breweries.

READ: Nigerian Breweries to pay Heineken BV mega dividend of N2.9 billion

How has increased competition and the fall in consumers affected both beverage companies? Who has responded better? I will review the FY 2020 performance of both companies in the fast-moving consumer goods segment to give an insight into how resilient these companies are.

For consistency, I am using figures from my TradingView platform.

First, let’s look at Income, NB Plc posted a 9% drop in Gross Profit but an increase in total revenues from FY 2019 to N337b in FY2020. This is impressive considering the fall in consumer spending due to the COVID-19 lockdown in 2020. However, NB plc achieved this improved sales with a 10% higher Cost of Sales growth. Net Income for NB Plc was posted at N7.36b, a huge 54% fall from 2019 figures.


NB Plc has seen negative Net Income figures since 2018 and posted negative Total Revenues numbers for two out of the last three years since 2018. This is reflected in the EPS figure of just 0.92 posted in 2020. This fall in earning has pushed the Price to Earnings Ratio to a high of 60.82.

READ: Guinness Nigeria’s market value surged by N23.8 billion in March 2021

Guinness posted a 17% drop in gross profit, with a steep 20% fall in total revenue, but it trimmed its Cost of Sales by 21% and posted a huge negative Net Income number of -N12b. This Guinness explains is a one-time charge on an extraordinary item being write-down of assets. On an EPS basis, Guinness thus posts a negative -5.74 Earning per Share. Whilst the 2020 results reflect the impact of extraordinary items, Guinness also saw a fall in Total Revenues, Operating Income, and Net Income before the COVID impact in 2019.

The problem for both companies is sales. Total revenues for NB and Guinness have been flat or negative since 2019, specifically both Guinness and NB posted negative Gross Profit when compared to 2019 FY results. However, one company posted a positive Gross Profit and total revenue, yes, International Breweries (IB Plc). IB Plc is achieving higher revenue numbers on the back of vastly increasing Cost of Sales. This again reflects in a negative EPS of-0.47 for IB Plc. This indicates that IB Plc is willing to incur huge marketing costs to capture market share.

READ: Alcoholic beverage makers on NSE lose a total N27.7 billion in a single day

Inventory turnover for IB is faster at 6.60 when compared to 5.89 for NB Plc and 2.77 for Guinness. In essence, IB is selling her brands faster than both NB and Guinness.

Next, we look at the Balance Sheet. Nigerian Breweries Total Equity which is Total Assets less Total Liabilities is a positive N161b which translates to a book value per share of N20.96. In essence, if you sold all the assets of NB PLC and paid all the debt of N91.45b, and shared out the net balance to all shareholders, they would receive N20.14 per share. Guinness has positive total equity of N73b, this translates to a book value per share of 33.34, much higher than NB because Guinness has a lower debt of N23b.

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Again both companies saw a dip in total equity with Nigerian Breweries total equity falling by 3.92% from 2019 and Guinness by a whopping 17.9% in the same period. Again to contrast with International Breweries who posts a Total Equity of N151b with a book value per share of N5.65 based on a much higher debt number of N115b. In summary, using the Debt to Asset ratio, IB Plc is more leveraged at 0.31 when compared to NB Plc at 0.21 and Guinness at 0.08. If interest rates continue to rise, this eats more into IB Plc.

READ: NB Plc gains as profit-taking in Dangote Sugar, PZ weigh on consumer goods stocks

Next, we look at the cash position by examining the Free Cash Flow position. FCF is the cash available for the company to repay creditors or pay dividends and interest. FCF excludes non-cash expenses. Nigerian Breweries has a negative cash position of -N447b, driven primarily from Capital Expenditures. This translates to a Price to Cash ratio of 5.49. For Price to Cash Flow, lower is better. Guinness FCF position is a positive N1.93b with a lower and better Price to Cash of 2.55. IB Plc also posts a positive FCF of N32b and Price to Cashflow of 3.14, however, it is important to note that IB Plc has paid no dividends for three years.

Finally, we plot the efficiency of management of both companies by comparing them to three performance ratios in Table 1 below.


Table 1.

 Return on Equity %Return on Invested Capital %Net Margin %
Nigerian Breweries Plc4.483.622.18
Guinness Plc-15.52-14.72-12.5
IB Plc-15.53-7.96-9.04

NB Plc, when compared to Guinness and IB post better profitability numbers but all three breweries are playing in a market where consumers have a lower purchasing power and are looking to affordability. Net Income for all three breweries is well below numbers posted in 2017. The risk to these companies is the shrinking market. Prices cannot be cut forever, thus productivity improvements to reduce costs will be the differentiator.

Unless the economy improves, this is a sector to be watched before you leap in.




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    Review: Excerpts from Aig-Imoukhuede’s interview with African Banker Magazine 

    On May 6 2021, Aigboje Aig-Imoukhuede granted an interview to Omar Ben Yedder to share insights on his life’s journey and career.



    WAPIC Chairman, Aig-Imoukhuede increases stake in the insurance firm

    Earlier this year, Aigboje Aig-Imoukhuede released a book titled: Leaving the Tarmac: Buying A Bank in Nigeria. On May 6 2021, he granted an interview to the Group Publisher of African Banker Magazine, Omar Ben Yedder, to share insights on his life’s journey and career.

    Nairametrics has recently featured reviews on the banking titan’s new book which you can read here and here. In this article, however, we share excerpts of Aig-Imoukhuede’s interview with Omar Ben Yedder of the African Banker Magazine.

    Meet Aigboje Aig-Imoukhuede

    Aigboje Aig-Imoukhuede was the former Group Managing Director of Access Bank Plc. He is also the Founder and Chairman of Coronation Capital Limited and its affiliates, Coronation Asset Management Ltd and Trium Ltd.

    Aigboje started his career as a lawyer before branching off into the banking sector. His banking career saw him ascend to the role of Executive Director at Guarantee Trust Bank, from where he ventured out to lead the acquisition of Acess Bank in 2002.

    On why he wrote the book 

    Aigboje stated that it is quite unfortunate that the African business scene does not have many Unicorn stories. He went on to explain that he wrote the book to kickstart a culture of Africans telling their own stories. He believes that Africans are capable of producing the same results as their counterparts across the world when given the opportunity. By writing this book, he hoped to challenge Africans to step up and make history.

    On how he managed to buy Access Bank

    Aigboje described his mental preparation for the moment when he bought Access Bank in 2002. He stressed that the most important aspect of leadership is preparation and advised young Africans to always give their best at all times wherever they find themselves.

    On his relationship with his successor, Herbert Wigwe

    Aigboje described his exceptional relationship with his successor, Herbert Wigwe, who he believes shares a lot in common with him. He explained how they both share the same views when it comes to problem-solving and how they share similar childhood experiences coming from modest civil service backgrounds.

    He stressed how competency and friendship helped shape the decision to bring his successor Hebert Wigwe on board. He had a great partnership experience with his successor and he is never in doubt of Wigwe’s competence.


    On fighting mediocrity in the Nigerian space 

    Aigboje explained his passion to return Nigeria to what it was when he was growing up. He explained what he believed to be troubling the Nigerian system.

    In his opinion, Nigeria, during the days of the British Administration prioritized the Civil Service at the same level as the Government. That is clearly not the case today. He stressed gross underinvestment in the welfare and development of civil servants as the elephant in the room on this issue.

    He reiterated the glory days of Nigeria when its soldiers were revered across the continent and her government schools were top-notch. He blamed corruption for driving Nigerian standards into the mud and prescribed that Nigeria return to its standards during British rule.

    On his philanthropic efforts 

    Aigboje is the Founder and Chairman of the Africa Initiative for Governance, an independent non-profit that promotes good governance in Africa. The Foundation partners with Oxford University School of Government for scholarships that send qualified African senior public servants to the university for Master of Public Policy degrees and Fellowships.

    What you should know

    • Aigboje Aig-Imoukhuede’s new book reveals how the creation of Access Bank resulted in spreading prosperity for thousands.
    • The book received accolades from prominent Nigerians like Amina J Mohammed, United Nations Deputy Secretary-General; Atedo Peterside, Founder of Stanbic IBTC and board member Standard Bank of South Africa; Aliko Dangote, Founder & President of the Dangote Group; Dr Akinwumi Adesina, President, Africa Development Bank and Nigerian Minister of Agriculture (2010–2015); Muhammad Sanusi II, CON, 14th Emir of Kano & Governor, Central bank of Nigeria (2009–2014).

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    Telegram launches exciting new features, better than WhatsApp and Clubhouse

    The new features include shopping features for buyers and sellers, updated voice chat tools for groups, new gesture controls on mobile, and more.



    Telegram, the cross-platform, cloud-based instant messaging application released new features to the app. The platform is one of the world’s top 10 most downloaded apps with over 500 million active users.

    Telegram’s new features include shopping features for buyers and sellers, updated voice chat tools for groups, new gesture controls on mobile, and more.

    Telegram’s payment feature for merchants

    Payments 2.0 allows merchants to receive payments made using credit cards while users can securely pay for goods and services without leaving the app.

    Telegram has integrated third-party payment providers like Stripe, Google Pay, Apple Pay, etc., so merchants can accept credit card payments on the app. Telegram will take no commission from its users as well.

    Telegram has also created a demo channel for users to test how this works without spending a penny.

    Telegram’s scheduled voice chats

    Telegram also launched its own version of Clubhouse-like audio chats. The feature lets Telegram group admins host and also schedule live chats that all group members can listen to. Admins can schedule a Voice Chat from their Group or Channel’s profile page.

    Mini profiles for voice chats

    With Telegram mini–voice chats, you can now expand profile pictures and bios to get a better idea of who you’re chatting with – without leaving the voice chat window.

    You can also change your profile picture and edit your bio without leaving the chat.


    Telegram’s new web versions

    Telegram added two new fully-featured Telegram web apps (Telegram web K and web Z) – both supporting animated stickers, dark mode, chat folders, and more. With the new web versions, you can get instant access to your chats on any device – desktop or mobile. Like other Telegram apps, the web versions are standalone: once you’ve logged in, you do not need to keep your phone nearby or connected to the internet. You can test-drive the new web apps to see the one you like best.

    Pinch to zoom

    Photos and videos can now be expanded directly from the chat – simply pinch to zoom-in right away, without tapping to open the media viewer.

    Improved Video Player

    When watching a video from the media player on iOS, press and hold the + or – 15s buttons to fast-forward and rewind. On Android, press and hold on the right or left side of the screen to do the same, and double-tap to jump 10 seconds in either direction.

    Tips and New Android Animations

    The Android app gets smoother and more dynamic with each update – check out the new animations when opening the side menu or swiping back to the chat list from a chat.

    What you should know about Telegram’s new features

    Telegram’s new features are a better upgrade to its competitors, clubhouse and WhatsApp.

    The voice chat option available as a feature on Telegram is similar to Clubhouse’s voice chat rooms while the new web versions are a better upgrade from WhatsApp’s web version because it works as a standalone. Once you are logged in, you do not need to keep your phone nearby or connected to the internet, unlike WhatsApp.

    Jaiz bank
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