Guinness Nigeria Plc has announced a revenue increase of six per cent for the first quarter of its financial year ended 30 September 2016. The brewing firm posted a revue of N23.018 billion in 2016, up from N21.742 billion in the corresponding period of 2015, gross profit stood at N6.572 billion, compared with N9.305 billion in 2015. However, net finance cost surged from N929 million to N2.898 billion. Consequently, the company ended the Q3 with a loss of N2.2 billion, as against a profit of N362 million in 2015.
Explaining the performance of the company, Managing Director/CEO, Guinness Nigeria, Peter Ndegwa, said the revenue growth was in spite of continuing challenges in the operating environment.
“The environment remains tough but we have seen contributions from our mainstream and international premium spirits brands as well as continuing growth of our value brands. These were the key drivers of the 6% revenue growth recorded for the quarter. Our cost of sales was impacted by the high inflationary environment and continuing currency devaluation leading to a reduction in operating profit. The higher finance cost in the quarter is due to the impact of unrealised foreign exchange losses as a result of the currency devaluation.”
He said going forward, innovation will continue to be a big part of our strategy us as we look to deepen our participation in the mainstream and value segments. “We will also continue to invest behind our brands with a key focus on building the right portfolio for future growth and re-shaping our organisation to take advantage of what is likely to continue to be a challenging market in the short to medium term,” he added.
Citing long term commitment to the Nigerian market as a key driver, Guinness Nigeria recently announced a further 12 million pound sterling of investments into Nigeria as it plans to commission a new spirits manufacturing line in its Benin plant in the coming weeks.
This investment, the company said would give a big boost to its ambition to source 75 per cent of its production raw materials locally in the next two years. Additionally, at the beginning of October, Guinness Nigeria inaugurated a new water project in a community in Benue State as part of its Water of Life programme, which in turn is one pillar within the company’s broader community investment agenda.