Nigerian Breweries grows 2016 revenue by 7%

Nicolaas Vervelde

Nigeria’s largest brewer Nigerian Breweries said its gross revenue for 2016 full year rose by 6.7% year on year.

The company posted a gross revenue rose to NGN313 billion compared to NGN293 billion reported in 2015.

However, the company said its gross revenue from other operating entities fell by 52% to NGN52 billion compared to NGN62 billion reported for these entities.

Nigerian Breweries is the largest buyer of other brewers, a position that has checkmated Diageo’s Guinness Nigeria PLC competitive strength across the length and breadth of Nigeria.

Inflation, Naira devaluation and macro-economic outlook has taken a toll on its cost management abilities. Cost of sales rose by 19% to NGN179 billion compared to NGN149 billion expended in 2015.

As a sign that the weight of its acquisitions has been factored into its costs, marketing distribution expenses rose to NGN61 billion compared to NGN58 billion in the previous year. Advertising and sales promotion was alloted 22 billion down from NGN23 billion in the previous year. The company is also paying more as a result of interest rate resets.

Finance cost have more than doubled in the last one year. An increase of NGN13 billion compared to NGN8 billion paid in the year before.

Total profit for the year was impacted by various rise in costs and finance burdens. The company said its net profit fell to NGN28 billion compared to NGN38 billion in the previous year.

Nigerian Breweries said its total asset for the year was NGN367 billion compared to NGN356 billion in the previous year. Total liabilities also rose to NGN201 billion compared to NGN183 billion in the previous year.