Anheuser Busch InBev (AB InBev), one of the world’s largest brewers, has demonstrated confidence in Nigeria through its latest investment of N512.8 billion in International Breweries Plc (IBPLC), its company in Nigeria.
Nnaemeka Achebe, chairman of the Board of Directors, commended the company on behalf of its shareholders, particularly after its Rights Issue which enabled the repayment of its forex-denominated loan that impacted the company over the years.
“The elimination of our FX exposure will improve IBPLC’s cash flows and support the company’s return to profitability. The offer was supported by our core shareholder, AB InBev which followed their rights in full. This is a strong indication of AB InBev’s commitment and belief in the Nigerian market opportunity and overall Nigerian economy.
“We are proud of the strides we have made in strengthening our business foundation and positioning for sustainable growth,” he said.
According to Achebe, the repayment of the outstanding $379.9 million loan, enabled by the parent company, AB InBev has bolstered IBPLC’s financial position.
“This recapitalisation not only strengthens our balance sheet but also sets the stage for long-term profitability and growth. We are now better equipped to drive innovation, improve operational efficiency, and seize new opportunities,” he said.
At its recently held 47th Annual General Meeting (AGM), IBPLC outlined its achievements and future strategies while emphasising the critical role shareholders have played in its progress.
A key highlight was the successful Rights Issue of over 161.2 billion shares, generating net proceeds of ₦581.7 billion.
The financial report presented at the meeting showed impressive results for the year where IBPLC said it recorded a 19.2 percent increase in revenue, rising to ₦260.6 billion in 2023 from ₦218.7 billion in 2022.
Gross profit climbed by 17.3 percent to ₦86.3 billion, while finance cost surged by 178 percent from N10.6 billion in 2022 to N29.7 billion in 2023, driven largely by FX losses as a result of currency devaluation at the macro level and higher interest expense on borrowings.
Despite challenging economic conditions, the company said it remains committed to innovation, customer satisfaction, and responsible business practices.
Carlos Coutino, managing director of IBPLC, attributed the challenges faced by the company to inflation, forex losses from the devaluation of the naira and streamlining of operations.
“In line with our business principles, we will continue to manage our costs tightly through our different cost management strategies as we remain focused on delivering value to our customers and driving innovation,” he said.
Coutino further said IBPLC’s commitment to excellence was underscored by its continued investment in new products, strategic partnerships, and state-of-the-art facilities, which have been key drivers of growth.
Shareholders expressed optimism about the company’s future, especially after the full repayment of its foreign loan, which will enable IBPLC to retain more of its earnings for future growth.
Eke Chibuzor, general secretary of the Independent Shareholders Association of Nigeria (ISAN), commended the company’s financial turnaround.
“While dividends have not been declared, management’s strategy is clear, and the 19 percent revenue growth shows progress. The fact that the company has repaid its loan with funds from the Rights Issue is a significant achievement,” Chibuzor said.
“Our focus remains on long-term growth. Last year, we made significant progress, and, this year, our successful Rights Issue—Nigeria’s largest—allowed us to reduce more than 70 percent of our foreign exchange obligations. This strengthens our capital structure and provides us with the flexibility to explore growth opportunities with reduced risk,” said David Tomlinson, finance director of IBPLC.
