Nigerian Breweries Plc has disclosed a net loss of N106 billion for the fiscal year ending December 31, 2023, primarily attributed to the adverse effects of naira devaluation on its foreign exchange transactions.
Despite a nine percent increase in revenue compared to the previous year, the company experienced a 15 percent decline in operating profit, amounting to N44.5 billion in 2023. Factors contributing to this decline include rising input costs, one-off reorganization expenses, and broader economic pressures.
Addressing the performance, Nigerian Breweries’ Managing Director/CEO, Mr. Hans Essaadi, acknowledged the challenging economic landscape in Nigeria. He cited persistent cash shortages, fuel subsidy removal leading to heightened energy costs, naira devaluation, forex scarcity, and constrained consumer spending amidst high inflation as significant hurdles.
Despite these challenges, Essaadi noted some positive strides, including revenue growth propelled by a favourable price mix. However, the company faced a substantial setback due to naira devaluation, resulting in a staggering N153 billion loss on forex transactions.
In response to the tough economic environment, Nigerian Breweries adopted a risk-reduction strategy focusing on positive pricing, efficient sales operations, robust cost management, and other efficiency measures.
Looking ahead, Essaadi acknowledged the persistent macroeconomic challenges but expressed optimism about potential opportunities. He highlighted the acquisition of an 80 percent stake in Distell Wines and Spirits Limited and exclusive rights to import Heineken Beverages’ brands from South Africa as a strategic move to diversify its portfolio and tap into growth prospects in the wines and spirits segment.
Essaadi reaffirmed Nigerian Breweries’ commitment to resilience and forward-thinking, leveraging its broad portfolio, robust supply chain, and dedicated workforce to drive long-term value creation for shareholders and stakeholders.
