FMCGs in 2019: Navigating the murky waters

Must Read

List of Guaranty Trust Bank Sort Codes & Branches (with addresses) in Nigeria

The sort code is a number which usually identifies both the bank and the branch where an account is...

GTBank Extends Banking Hours Till 6pm

Guaranty Trust Bank, GTBank has announced the extension of its banking hours till 6 pm today, Monday, 20 January...

Top 10 Most Expensive Universities In Nigeria

For many Nigerians, high-quality higher education is a luxury. There are many private universities who are known not only...
- Advertisement -
- Advertisement -

Our view on the Fast Moving Consumer Goods (FMCGs) sector remains modestly positive on the back of a gradual recovery in the economy. However, challenges to volume growth may persist due to bottlenecks t o distribution. Pressure on volume growth and transport cost is likely t o persist as difficulty associated with the gridlock at Lagos port is unlikely t o go away i n the interim.

In our view, this is negative for food manufacturers in the Apapa axis as well as others who depend on the importation of their ware (e.g. PZ).

FMCGs in 2019: Navigating the murky waters

Diversified food & beverage producers such as NESTLE and UNILEVER are expected to sustain a solid outing due to continued improvement in the broader macro environment. The performance of the beer makers (NB, GUINNESS, and INTBREW) will continue to be shaped by growing competition and the possibility of a revised levy on alcoholic beverages going forward.

Read:  Diageo is quietly building a digital powerhouse to recalibrate its brands for younger generations

In all, our best picks in the sector are NESTLE and UNILEVER, buttressed b y their solid balance sheet positions, product and brand durability. We are not very positive on FLOURMIL and DANGSUGAR, a s our short-term expectation i s dampened by the feedback effect of Apapa gridlock and smuggling activities on volume growth. For the brewers, w e see further pressure on NB’s numbers going forward. We expect INTBREW t o continue t o report positive revenue, however, pressure on cost lines remain a concern. GUINNESS’s performance may b e supported b y its growing spirit line, but this may not be enough to boost bottom line growth.

Read:  British Trade Envoy Praises Unilever’s Sustainable Living Plan



- Advertisement -

Subscribe to BrandSpur Ng

Subscribe for latest updates. Signup to best of brands and business news, informed analysis and opinions among others that can propel you, your business or brand to greater heights.


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest News

Citigroup Turns in an Excellent Q4 2019

Net Income of $5.0 Billion ($2.15 per Share) Revenues of $18.4 Billion Returned $6.2 Billion of Capital to...

Par-Tee like Royalty at Holey Moley’s VIP Booths in Singapore’s Main Party Zone

SINGAPORE - Media OutReach - 23 January 2020 - Holey Moley, Singapore's 1st mini golf bar, is shaking things up in 2020 -- this time, with sleek VIP...

New Economist Intelligence Unit (EIU) study finds a need for more balanced regulation to protect innovation and societal benefits

The increased pace of technological change is making it difficult for regulators to keep upA knee-jerk regulatory reaction that results in an outright ban...

Former New York University President John Sexton will be Asian University for Women’s 2020 Commencement Speaker; an Indian economist, a Pakistani actress, and a...

CHITTAGONG, BANGLADESH - Media OutReach - 23 January 2020 -  Professor John Sexton, a U.S. national, who served as the fifteenth President of New York University (NYU)...

More Articles Like This