Nigerian Breweries’ profit declines by 11%

Nigerian Breweries Plc has declared 11 per cent decline in profit after tax to N19 billion for the six months ended June 30, 2016 from N21.5 billion posted in the prior six months.

The unaudited condensed interim financial statements posted on The   Nigerian Stock Exchange official website, shows that the group profit before tax also dropped by 18 per cent to N25.5 billion from N30.99 billion recorded in six months ended June 30, 2015.

Major contributors to the company’s  plunge in profitability include eight per cent increase in cost of sales from N77 billion to N83.39 billion while finance cost significantly rose by 151.5 per cent to N8.6 billion as against N3.4 billion recorded in six months ended June 30,2015.

The company noted that interest expenses for the six-month period of 2016 amounted to N1.6 billion as against N2.5 billion in six months ended June 30, 2015.

Other net finance expenses for the six-month period June 30, 2016 amounted to N7 billion as against N0.9 billion expenses in six months of 2015.

The breweries manufacturing company revenue for the period increased marginal by four per cent from N151.67 billion in six months of 2015 to N157.37 billion in the current six months period.

In the first quarter results, the company in a statement signed by the company’s Secretary/Legal Adviser, Mr. Uaboi Agbebaku, said, “although the board expected the operating environment in 2016 to continue to be very challenging, it remained confident that the company was in a good position to take advantage of any upswing in the market especially with its twin agenda of cost leadership and market leadership supported by innovation.

In addition, to the six months unaudited results, the company said it acquired plant and equipment with a cost of N6.1 billion, 56 per cent below N13.8 billion worth of property acquired in prior six months.