Daud Olatunji
Nigerian Breweries Plc has reported a staggering N160.48 billion in foreign exchange losses as of the end of the third quarter, marking a sharp increase from the N86.83 billion recorded by September 2023.
This was disclosed in the brewer’s unaudited financial results filed with the Nigerian Exchange Limited on Wednesday, highlighting a challenging financial landscape aggravated by the naira’s devaluation and increased operational costs.
The financial report shows that the company’s FX losses have surged by 84.83 per cent year-on-year.
Over the last three months, Nigerian Breweries recorded an additional N48.21 billion in forex losses, with the figure climbing from N112.27 billion in June 2024.
This latest setback follows the N153 billion FX loss the company suffered in 2023, which the firm attributed to the steep devaluation of the naira.
In response, Nigerian Breweries recently launched a N599 billion rights issue aimed at mitigating the impact of its FX exposure.
Despite the forex setback, Nigerian Breweries posted a revenue surge of 74.9 per cent, reaching N703 billion by the close of the third quarter.
However, the company’s loss after tax rose dramatically by 161.39 per cent to N149.50 billion, keeping it firmly in the red.
Hans Essaadi, Managing Director/CEO of Nigerian Breweries Plc, highlighted the company’s resilience in a press statement, attributing the revenue growth to strategic pricing, innovation, and market recovery.
He acknowledged the challenges posed by high inflation, currency volatility, and rising input costs but praised the company’s operational endurance.
“The business has delivered growth in the face of the challenging operating environment.
“Revenue grew by 75 per cent, benefiting from strategic pricing, innovation, and market recovery,” Essaadi stated.
He further explained that the FX losses were primarily due to naira devaluation and high borrowing costs linked to rising interest rates, but expressed optimism that the proceeds from the rights issue would help stabilize the company’s finances and reduce its exposure to foreign exchange risks.
Uaboi Agbebaku, Company Secretary and Legal Director of Nigerian Breweries, expressed the board’s commitment to steering the company through this turbulent period.
Reaffirming Nigerian Breweries’ dedication to the Nigerian market, he highlighted the company’s focus on people development, strategic innovation, and community impact.
“We remain confident in our long-term strategy to deliver value to our shareholders. We are grateful to our trade partners, customers, and all stakeholders for their unwavering support during these challenging times,” Agbebaku said.
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