Guinness Nigeria Reports 20% Increase in Revenue for Q2 F24

Strong Revenue Growth of 20%
Operating Profit Increased by 31%,
Administrative Expenses Reduced by -6%
Guinness Nigeria, a leading beverage alcohol company in Nigeria, continues to show resilience in the face of a challenging macroeconomic environment characterized by a marked decline in consumer spending due to escalating inflation, continuous Naira devaluation and reduced cash in circulation. The company has posted a revenue of N142,595,584 for its half-year, ended 31 December 2023, a growth of 20% over the previous year.

The unaudited result released to the Nigerian Exchange Group (NGX) showed a 31% increase in operating profit in the period under review. At the same time, its reported revenue growth was primarily fueled by sound pricing strategies and a carefully optimized product mix, emphasizing the premium categories. The company further bolstered sales by increasing trade and consumer engagement initiatives, optimizing its route-to-consumer strategy to broaden its outlet coverage, and leveraging its digital capabilities. Key categories, particularly Malt and Ready-to-Serve, experienced notable revenue growth, while others demonstrated more modest increases.

Impressively, operating profit increased by 31% and the operating margin expanded by 90bps, fueled by 9% increase in gross profit, gains from other income (Export Expansion Grant), and reduced operating costs, even as brand investment increased by 15%.

The Managing Director/CEO of Guinness Nigeria Plc, Mr Adebayo Alli, stated that “while this was a commendable performance in the face of a very challenging macro environment, regrettably, the persistent devaluation of the Naira led to a substantial (N18bn) unrealized foreign exchange loss, which caused a 161% decline in profit before tax, closing the half-year at a loss of N4.4b.” He, however, stated that “management of the Company remains committed to taking all steps and proactive actions necessary to continue delivering value to its stakeholders.”

Also commenting on the results, the Board Chair, Dr. Omobola Johnson, stated that ”despite the significant macro-economic challenges faced by the company, the Board remains confident in the company’s well-devised strategy and will continue to support management to implement the strategy in a manner that delivers sustainable value to all stakeholders.”