Nigerian Breweries Plc Records Massive N106.3 Billion Loss in 2023



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Throughout 2023, Nigerian Breweries Plc faced a challenging financial landscape, culminating in a substantial annual loss of N106.3 billion, significantly impacting its equity reserves, which plummeted from N180 billion to N63.3 billion, marking a notable decline.

The primary driver behind this loss was a staggering net foreign exchange (FX) loss of N153.3 billion, a stark increase from N26.3 billion in 2022. Additionally, finance costs surged more than fourfold to N36.4 billion for the year, reflecting the company’s heightened indebtedness.

Operating with interest-bearing debts totaling N341.6 billion, nearly three times the previous year’s outstanding borrowings of N122.2 billion, the company faced intensified financial pressures.

The final quarter alone contributed N49.3 billion, representing 46.4 percent of the total annual loss, with net FX losses further exacerbating the situation.

Despite a growth in sales revenue to N599.6 billion, production costs surged by approximately N50 billion, surpassing the revenue increment. Consequently, gross profit declined marginally from N213.3 billion to N212.6 billion.

Operational challenges persisted as other income declined, and selling, distribution, and administrative expenses rose, leading to a reduction in operating profit from N51.7 billion to under N44 billion.

A substantial net finance cost of N189.2 billion, primarily driven by foreign exchange losses and finance expenses, overshadowed the operating profit, resulting in a pre-tax loss of N145.2 billion, a sharp contrast from the N17.3 billion pre-tax profit in 2022.

While a tax credit of N38.9 billion mitigated the net loss to N106.3 billion, the company’s capital base suffered, transitioning from retained earnings of N91.9 billion in 2022 to a retained deficit of N26.3 billion by the end of 2023.

Consequently, the company’s capital stock dwindled from N180.9 billion in 2022 to N63.3 billion, marking a significant reduction.

Nigerian Breweries’ quarterly losses since Q3 2022, primarily fueled by FX losses, underscore the persistent operational challenges faced by the company, magnifying the need for strategic interventions to reverse the trend.

Emman Tochi
Emman Tochi
Emma Tochi is Naija247news Media Northern Bureau Chief, he's based in FCT Abuja. He overseas the northern operations of this business media

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