Naira Devaluation Triggers Nigerian Breweries’ N78.16bn Loss In Nine-months
Nigerian Breweries Plc is another casualty of the naira devaluation, suffering N78.16 billion loss before tax in its unaudited nine months ended September 30, 2023.
The company on the Nigerian Exchange Limited (NGX) had declared N19.09 billion profit before tax in the corresponding nine months of 2022.
From the profit and loss figures, Nigerian Breweries also declared N57.19 billion loss after tax in nine months of 2023 from N14.76 billion profit after tax posted in nine months of 2022.
Extracts from the unaudited results showed that the company reported N86.83 billion net loss on foreign exchange transactions in nine months of 2023 from N10.36 billion declared in nine months of 2022.
In the period under review, Nigerian Breweries posted N401.8 billion in revenue, an increase of 2.1 percent from N393.45 billion reported in the corresponding period.
Cost of sales stood at N249.24billion in nine months of 2023, an increase of 4.3 percent from N23.92billion reported in nine months of 2022, while operating expenses stood at N126.78billion in nine months of 2023, representing an increase of 4.8 percent from N120.95billion reported in nine months of 2022.
The company in a statement said “Overall, volumes declined in the period under review due to continued high pressure on disposable income and the socio-political challenges in various parts of the country. However, flavored beer volume increased led by Desperados.
“Revenue increased by a low-single-digit percentage driven by pricing to mitigate inflation. The operating profit was impacted by the lower volumes, higher input costs influenced by inflation and devaluation of the naira, and a one-off restructuring cost. Pricing and significant cost savings initiatives were not enough to fully mitigate rising input costs.”
The multinational brewer maker in a statement said a combination of foreign exchange losses due to the devaluation of the naira and higher interest costs resulted in a net loss during the period.
Over the poor performance, the company’s stock price depreciated to N38 per share on Wednesday from N39 per share when it opened for trading.