The Managing Director of Nigeria Breweries Plc, Mr. Hans Essaadi has outlined certain macroeconomic issues that will affect the company’s performance in 2024.
These inlcude; high inflation, naira devaluation, the “Japa syndrome”, insecurity and pressure on consumer’s disposable income.
At the Pre-Annual General Meeting press conference held by Nigerian Breweries Plc in Lagos on Wednesday, Managing Director Hans Essaadi outlined the economic challenges of 2023. This included Naira scarcity, the removal of fuel subsidies, a foreign exchange crisis, food inflation, and a triple increase in beer excise rates among other issues.
Essaadi explained that these factors significantly affected consumer disposable income due to increased input costs from the removal of fuel subsidies and the foreign exchange situation.
He noted that in the company’s long-term outlook remained positive with Nigeria’s young population and its position as the largest economy in Africa to spur growth and improved performance going forward.
- What he said, “The outlook for market fundamentals remains positive with positive long-term fundamentals such as rising and young population, urbanisation, and the largest economy in Africa.”
- “However, short-term volatility to manage includes devaluation and high Inflation, insecurity, pressure on disposable consumer spending and the Japa syndrome.”
- “Our 2024 recipe for success is hinged on our strong business recovery plan to continued strong cost management and further optimisation of our operational footprint.”
- “We would continue to leverage our strong portfolio, exciting innovations, delight our customers with exciting new portfolios, while prioritising our employees, communities and stakeholders,”
Essaadi emphasized that the company’s enduring strategy for business growth, profitability, and delivering shareholder value was key to its resilience during the year.
Backstory
For the full year 2023, Nigerian Breweries recorded a net loss of N106 billion from a profit of N13 billion recorded in the previous year. The company’s Managing Director noted that the naira scarcity coupled with high inflation in 2023 crushed disposable income of consumers.
Recently, the company announced plans to suspend operations in two of its nine production plants in Nigeria as part of measures to deal with the harsh operating environment in Nigeria.
