Nigerian Breweries Plc monday announced its audited results for the year ended December 31, 2016, showing a decline of 25 per cent in profit after tax (PAT), reflecting the challenging operating environment.
Although the leading brewer posted a growth of 6.7 per cent in revenue, a combination of rising inflation and impact of the naira devaluation drove down its bottom-line. Specifically, the company recorded a revenue of N313.743 billion in 2016, up from N293.9 billion in 2015. Cost of sale rose from N149.73 billion to N178.218 billion. Marketing and distribution expenses also rose from N58.45 billion to N61.312 billion. While the company brought down administrative expenses, finance cost increased by 66 per cent from N8.217 billion to N13.645 billion. However, this increase was majorly driven by net foreign exchange loss of about N7.552 billion, compared to N752 million in 2015.
Following the huge forex loss, Nigerian Breweries Plc ended the year with profit before tax of N39.675 billion, down from N54.514 billion in 2015 and PAT of N28.416 billion as against N38.05 billion in 2015.
The directors have recommended a final dividend of N20.457 billion, which translate to N2.58 per share. This brings the total dividend to N28.386 billion or N3.58 per share, having already paid an interim dividend N7.929 billion or N1.00.
However, the directors of the company have also made a recommendation to the shareholders to receive new ordinary shares of in the company instead of the final dividend.
While commenting on its nine months results last year, Nigerian Breweries had said that although the operating environment was expected to remain challenging for the rest of the year, it would “continue to focus on our twin agenda of cost and market leadership supported by innovation.”
The firm expressed confidence that it was well positioned to take advantage of any upswing in the market.
Meanwhile, the stock market opened on a positive note as bargaining hunting activities dominated the trading yesterday. The Nigerian Stock Exchange (NSE) All-Share Index appreciated by 0.34 per cent to close at 25,249.49. The positive performance was partly bolstered by increased demand for Nigerian Breweries Plc as investors reacted to the full year results.
Other stocks that influenced the performance included: Diamond Bank, Oando, Guinness and PZ Cussons among others. The total value of stocks traded on stood at N985.67 million, down by 50.20 per cent from N1.98 billion recorded last Friday. The total volume of stocks traded was 110.01 million in 2,160 deals.