Nigerian Breweries Net Loss Expands by 161% to N149.5bn

Nigerian Breweries loss after tax has expanded by more than 161% year on year to about N150 billion at the end of the third quarter of financial year. In its unaudited financial statement, the brewer reported a net loss of N149.50 billion, primarily driven by a substantial FX loss of N160.48 billion.

Revenue rose by 76.9% year on year to N710.87 billion on the back of pricing adjustments. Reflecting weak macroeconomic conditions, Nigerian Breweries cost of sales grew faster by 101.1% to N500.959 billion from N249.241 billion in the comparable period.

Analysts said inflation and currency pressures led to a 129.5% increase in raw material and consumable costs used by Nigerian Breweries in the period,

The company’s operating expenses (OPEX) increased by 42.9% year on year driven by a rise in selling and distribution costs and administrative expenses.

Also, finance costs rose by 281.4% to N42.54 billion, driven by accrued interest payments on loans and borrowings.

Reducing the pressure from its borrowing costs, the company saw a 65.3% year on year increase in finance income.  Unfortunately, its FX losses also increased by 84.8% to N160.48 billion.

Nigerian Breweries pretax loss for the period settled at N203.0 billion. Elsewhere, NB reported a tax credit of N53.50 billion, which softened the bottom-line impact, bringing the net loss to N149.50 billion, analysts said.

In a statement, Nigerian Breweries said the company remains resilient in the face of a challenging operating landscape in Nigeria marked by high inflation rates, deteriorating Naira value and increasing input costs.

Management explained that revenue grew by 75% driven by strategic pricing, innovation, and market recovery. The company said its gross profit grew by 36% although lower than revenue growth due to a 99% increase in cost of goods sold.

Management said the increase in net loss was again significantly influenced by FX loss due to the devaluation of the naira and high borrowing costs arising from higher interest rates. #Nigerian Breweries Net Loss Expands by 161% to N149.5bn