Nigerian Breweries Plc (NB), the country’s largest brewer, reported a net loss of N106 billion ($235 million) for 2023, blaming a combination of economicheadwinds and the devaluation of the naira.
The company’s CEO, Hans Essaadi, painted a bleak picture of Nigerian consumers struggling to afford even a basic beer, highlighting the depth of the nation’s economic woes.
“It has been an unprecedented year,” Essaadi told investors, as reported by Bloomberg. “We saw a significant decline in the mainstream lager market as a result of Nigerian consumers no longer able to afford a Goldberg after a hard day’s work.”
NB’s struggles mirrored the broader Nigerian economy. The company grappled with:
-N153 billion ($338 million) foreign exchange loss due to naira devaluation.
-High inflation, particularly in food, exceeding 30%.
-Fuel subsidy removal further squeezing household budgets.
-Cash shortages following the naira redesign.
Despite revenue growth of 8.9% to N599.64 billion ($1.3 billion), operating profit fell 15% due to higher input costs and one-off expenses.
The company also faced a 449.7% increase in net finance expenses to N189.19 billion ($418 million), driven by the forex losses.
The NB board acknowledged the challenges but expressed confidence in the company’s resilience. They emphasized their long history in Nigeria, a broad product portfolio, and a strong supply chain. They also highlighted recent price increases to manage rising costs.
