Guinness Nigeria Plc, an alcoholic beverage company, recorded a 20.4 percent increase in its sales to N142.6 billion for the six months ended December 2023 from N118.5 billion in the same period of last year, according to its latest financial statement.
The company’s finance cost surged by 255.9 percent to N23.9 billion from N6.71 billion during the period.
“While the brewer demonstrated strength in revenue growth in the period, the substantial increase in finance costs, majorly due to foreign exchange loss, impacted earnings in the period,” analysts at Cordros Research said in a recent note.
They projected sustained revenue growth for the company fueled by premiumisation and a favorable price/volume mix.
“Nonetheless, the brewer faces significant FX volatility risk, prompting a decision to halt the importation of Diageo premium spirits.”
Omobola Johnson, the company’s board chairman, said despite the significant macroeconomic challenges faced by the company, the board remains confident in its well-devised strategy.
“We will continue to support management to implement the strategy in a manner that delivers sustainable value to all stakeholders,” she said.
The firm recorded an after-tax loss of N5.23 billion for the six months ended December 2023 from a profit of N4.02 billion in the same period of 2022.
Here are 5 key takeaways from the company’s half-year financial results.
Operating expenses grew marginally
Guinness Nigeria’s operating expenses grew by 4.43 percent to N32.1 billion from N30.7 billion.
Liquidity saw a boost
Guinness Nigeria’s cash and cash equivalents rose to N92.1 billion from N69.10 billion during the period.
Finance income
Finance income grew by 119.4 percent to N3.05 billion, driven by gains on the re-measurement of foreign currency balances.
Other income
Guinness Nigeria’s other income surged to N2.51 billion from N954.4 million. Input cost grew by 33.0 percent to N96.7 billion.
Cash flows
Net cash from operating activities increased to N49.5 billion, net cash from investing activities recorded a loss of N2.79 billion and net cash from financing recorded a negative value of N13.9 billion.
