CEO, NB Plc, Nicolaas Vervelde
Ahead of its forthcoming Annual General Meeting (AGM), the board of Nigerian Breweries Plc, has proposed for the distribution a total of N22.687 billion as dividend for the year ended December 31.
Chief Executive Officer of the company, Nicolaas Vervelde, who disclosed this at its pre-AGM press briefing in Lagos yesterday, said the dividend pay-out represents 300 kobo per share, as against the 240 kobo each paid the previous year.
He said revenue from sales within the period grew from N185.862 billion by N44.261 billion or 23.81 per cent; profit before tax rose to N56.372 billion from N44.88 billion, representing a growth by about N11.492 billion or 25.6 per cent; while net profit within the period increased by N7.693 billion or 25.36 per cent to N38.025 billion from N30.332 billion in the previous year.
Earlier, the company’s Finance Director, Jasper Harmaker, noted that the dividend policy for the second-year running was a 60 per cent of profit, keeping the rest to fund expansion, unlike before then, when the entire net profit was distributed to its shareholders.
Vervelde also noted that NB had over the past five years since 2007 doubled sales revenue (turnover), PBT and PAT.
While turnover grew progressively from N111.748 billion at the beginning of the period to N226.228 billion, representing an increase of 102.44 per cent; pre-tax profit climbed by 104.9 per cent from N27.876 billion.
Net profit also increased by 102.76 per cent from N18.942 billion profit in the corresponding period 2007.
Incidentally, the company’s share price has also almost doubled within the period from N49 each in 2007 to N94.42 per share as of December 31, 2011.
For 2011, he explained that growth in turnover and profit came principally from sales volume increase, rather than price increase, just as 10 per cent of revenue also came from innovation within the period, an increase over the 9.0 per cent recorded in 2010.
He noted that the quarterlies and full year results would now be prepared and presented following International Financial Reporting Standard (IFRS) format as required by law.
“The impressive performance and success of the company over the years is the outcome of its history since 1946, up to when it established the first brewery in Nigeria,” he said.
The success, Vervelde continued, is also the result of remaining competitive by identifying key “must-win-battles” for its management, including driving top-line growth, effective cost management, enhancing human resources, sustainability, and sustaining financial performance.
He said figures for Sona Breweries in Otta and Kaduna as well as Life Breweries, Onitsha, whose brewery assets were acquired in 2010, were only consolidated from October 2011.
Following the acquisitions, the company, he continued, spent a lot of money upgrading production facilities of the breweries, besides repairs, maintenance, investments in the brands, and massive training for their workforce.
As reward, the new acquisitions, he said, would bring benefits such as ensuring extra capacities, and an expanded brand portfolio that will, in the coming years, help turnover and profit growth.
He also spoke of plans to increase local content of its raw materials to 60 from the current 40 per cent; adding that already, 80 per cent of the packaging components- bottles, cans, labels was sourced domestically. Sugar and barley are considered foreign components in the process.
“The competition has become fiercer over the last few years. The competitors are reinvesting in their brands to offer Nigerian consumers more choice in terms of brand taste and value. All are investing in capacities and NB is looking at a growing market with further capacities. (In all of these), it is the consumer that would make the choice.
“Overall, the number of brands and price propositions has gone up over the last two years,” he added.