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Guinness Nigeria Share Price Hits New High on Improved Results

Goddy Egene

The shares of Guinness Nigeria Plc rose by 27.5 per cent to close at N96.33 per share last week. The stock had opened the week at N75.50 per share before increased demand by investors following the improved full year results ended June 30, 2017, lifted it to close higher at N96.33.

At the new price, investors who participated in the just concluded Rights Issue, have recorded a capital growth of 66 per cent. The rights issue, through which the company intended to raise about N40 billion, was made to existing shareholders at N58 per share.

Market analysts said investors are taking position ahead of better performance by the company would record after recovering from loss this year.

Guinness last week reported a revenue of N125.919 billion in 2017, up from N101.973 billion in 2016. Net finance cost increased from N6.763 billion to N7.524 billion, making the brewing to end the year with an operating profit of N10.186 billion, up from N4.415 billion in 2016. Profit after tax stood at N1.923 billion, compared with a loss of N2.34 billion in 2016.

Explaining the results, Managing Director/CEO, Guinness Nigeria, Mr. Peter Ndegwa, said that they were driven by a relentless focus on executing their strategy and keeping costs down.

“Despite the challenging economic conditions, we have remained focused on executing our company’s total beverage strategy which gained further traction with strong growth in our international premium spirits portfolio following our first full year of distribution,” he said.

In December 2015, Guinness Nigeria Plc became the first total beverage alcohol company in Nigeria when it acquired the rights to distribute International Premium Spirits (IPS) including Johnnie Walker Scotch whisky and Bailey’s liqueur in Nigeria. This was quickly followed in January 2016 by the acquisition of the rights to distribute McDowell’s, a United Spirits Limited (USL) whisky brand.

And Ndegwa said: “Our gross profit of N48.3bn is as a result of volume growth, pricing benefit and a favourable sales mix as we continued to invest in our expanded brand portfolio during the year. Part of that investment includes the N4.7billion spirits line for locally manufactured spirits which we commissioned in Benin.

These strategic acquisitions and expansions have filled the gaps in the spirits brand base allowing us to compete across all categories of the alcoholic beverage market in Nigeria. We remain committed to executing our productivity agenda with a strong focus on cost reduction, distribution and operational efficiencies.”