Nigerian Breweries to Raise N48bn via Commercial Paper


Goddy Egene

Nigerian Breweries Plc has launched its series 7 and 8 commercial papers(CPs) to raise up a miaximum of N48 billion. In a notification to the Nigerian Stock Exchange (NSE), Nigerian Breweries Plc said offer will open April 6, 2020.

According to the brewing firm, while series 7 would be for a tenor of 182 days, series 8 would be for 270 days.

“The CP programme aims to raise up to a maximum of N48 billion to support the company’s short term funding needs. The CP programme continues to provide the opportunity for non-equity investors to invest in the company, support the company’s cost management initiatives and serve as an additional source of funding for the company,” it said.

Nigerian Breweries Plc recommended a final dividend of N1.51 for shareholders for the full year ended December 31, 2019. The company posted a revenue of N323 billion, showing a marginal decline compared to N324.4 billion in 2018. Cost of sales fell from N197.5 billion to N191.8 billion, while operating expenses rose from N90.8 billion to N97.1 billion in 2019.

Net financing cost grew by 57.4 per cent from N7.5 billion to N11.9 billion. Profit before tax fell by 20.6 per cent to N23.4 billion, compared with N29.4 billion in 2018. A reduction in tax rate made the profit after tax to decline slower by 17.1 per cent from N19.4 billion to N16.4 billion.

Looking at the performance for the full year, analysts at Cordros Capital said this is the strongest y/y revenue growth since third quarter (Q3) 2017.

“We note that gains at the gross revenue level were slightly eroded by the higher excise duty expense compared to last year. Sequentially, net revenue grew 33.3 per cent quarter –on-quarter (q/q), the impact of the price increases and Q4 being a seasonally strong quarter due to the year-end festivities,” the analysts said.