Nigerian Breweries Plc has posted its financial statement for the first nine months of the year, recording a 159.7% increase in its pre-tax losses compared to the same period last year.
In the first nine months of 2024, the company’s pre-tax losses increased from N78.16 billion between January and September 2023 to N202.99 billion.
The company during the period under review saw its revenue rise to N710.87 billion from N401.87 billion in the corresponding period of 2023.
However, significant increases in the cost of sales and foreign exchange losses coupled with significant finance cost resulted in an after-tax loss of N57.19 billion in the first nine months of 2023.
Key Highlights of the report
- Revenue- N710.87 billion, +74.66%
- Cost of Sales- N500.95 billion, +100.9%
- Gross Profit- N209.91 billion, +37.59
- Selling and Distribution Expenses- N143.10 billion, +40.9%
- Administrative Expenses- N37.76 billion, +50.7%
- Foreign exchange transaction losses- N160.48 billion, +84.4%
- Finance cost- N72.04 billion, +281.5%
- Net finance cost- N232.04 billion, +120%
- Pre-tax losses- N202.99 billion, +159.7%
- Tax income- N53.49 billion, +155.2%
- Loss after-tax – N149.50 billion, +161.4%
- Basic Earnings per share (EPS)- (-N1,455), +161.2%
In the third quarter of the year, the company’s revenue stood at N226.09 billion while the cost of sales reached N175.86 billion more than a 100% increase from N84.14 billion recorded in the third quarter of 2023.
Between July and September 2024, the company’s pre-tax losses increased more than seven-fold to N86.65 billion from just N10.13 billion recorded in the corresponding period of 2023.
Commentary: Nigerian Breweries continues its woeful financial performance from 2023 owing to inflation pressures affecting raw materials cost and foreign exchange problems beginning since last year.
In the same period of last year, the company attributed its losses to lower sales volumes, rising input costs driven by high inflation, the naira’s devaluation, higher interest expenses, and a significant increase in foreign exchange losses stemming from the currency’s devaluation.
It seems the company is still susceptible to the current macroeconomic malaise bedevilling Nigeria as its raw materials cost spiked by 129% from N177.4 billion in the first nine months of 2023 to N407.19 billion in the current period.
Also, the problems in the foreign exchange market significantly impacted the company’s performance with forex revaluation losses increasing by 84% to N160.4 billion from N86.8 billion.
During the period under review, the company reacted to the high inflationary environment by increasing the prices of products twice as announced. Also, the seemingly harsh operating environment necessitated the company to suspend operations in two of its nine production plants.
Nigerian Breweries Plc to restore its balance sheet to a healthy position carried out a capital raise by way of Right Issue to the tune of N600 billion which closed just a week ago.
