Champion Breweries Plc, in the second quarter of 2024, experienced a 65.6% year-over-year increase in revenue, rising from N3.12bn during the same period the previous year to N5.17bn.
Its interim income statement, which was submitted to the Nigeria Exchange Limited on Monday, made this information clear.
Continuing, the company’s cost of sales climbed by 60.1% to N2.89 billion from N1.80 billion in 2023. This increase was ascribed to higher manufacturing and distribution expenses, which were driven by increasing operational activity and inflationary pressures. In addition, the gross profit for the quarter increased by 72.9% to N2.28 billion from N1.32 billion during the same period the previous year.
Selling and distribution costs increased from N736.14m in 2023 to N1.03bn, a 40% increase. In a similar vein, over the same time period, administrative expenses increased by 53.9%, from N406.39 million to N625.58 million.
Operating activity results improved, with the company reporting an operating profit of N639.55 million, compared to N195.53 million in the prior year. This is a 227 percent gain, which is indicative of the company’s growing revenue and operating effectiveness.
But in Q2, Champion Breweries had a net loss on foreign exchange transactions of N167.46 million, which added to the quarter’s total finance costs of N6.68 million (net finance costs of N174.14 million).
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With a profit before taxes of N465.41 million, it increased by 154.3 percent from N183.06 million in 2023. Champion Breweries’ profit after tax for the second quarter increased by 248% to N437.18m after deducting income tax charges of N28.23 million.
In contrast to the N29.07 million profit it made during the same period last year, the brewer lost N386.66 million in the first half of 2024. The company’s total assets decreased by 8.7% to N18.76 billion in June from N20.55 billion in December 2023. This decline was mostly caused by a large reduction in cash and cash equivalents, which decreased by 63.9% during that time from N2.44 billion to N883.25 million.
By the end of 2023, total equity had dropped to N10.81 billion from N11.2 billion, a 3.5 percent decline. Retained earnings fell from N3.06 billion to N2.67 billion, a 12.7 percent decline.
The corporation kept its share premium at N519.1m and its share capital at N3.91bn notwithstanding the decrease in equity. Due in major part to a 77.4% reduction in borrowings from N1.35 billion to N304.21 million and a 20.1% fall in trade and other payables from N5.55 billion to N5.10 billion, the brewer was able to reduce its liabilities by 15%, from N9.36 billion in 2023 to N7.95 billion in 2024.
