Guinness optimistic despite N81bn FX loss

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Guinness Nigeria Plc has improved its operating profit by 27 per cent to N2.21bn in the first quarter of 2024 despite N81bn foreign exchange loss.

This was revealed in the unaudited financial results for the nine months, ended, 31 March 2024 filed with the Nigerian Exchange Limited.

In a statement accompanying the financial results, the company said its results revealed both resilience and adaptability in navigating a turbulent economic landscape.

It noted, “In a year marked by unprecedented challenges, Guinness Nigeria delivered a commendable 28 per cent year-on-year revenue growth, reaching N220.3bn compared to N172.47bn in the same period last year. This notable surge was particularly pronounced in Q3, with a remarkable 44 per cent acceleration, signifying a strategic pivot amidst evolving market dynamics.

“Despite grappling with soaring inflation rates, currency devaluation, and escalating food insecurity, Guinness Nigeria demonstrated remarkable resilience, leveraging proactive pricing strategies and optimised product offerings, focusing on premium categories to sustain growth momentum.”

It added that the company intensified its focus on consumer engagement and trade support, leveraging its digital platforms.

It stated that categories such as non-alcoholic malt, ready-to-serve beverages, and international premium spirits witnessed substantial revenue growth, underscoring the effectiveness of these strategies.

“In tandem with revenue growth, operating profit surged by 27 per cent, reaching N2.21bn fuelled by the strong revenue performance and intensified drive for productivity across the organisation despite extreme inflationary tensions.

“However, amidst these triumphs, challenges persisted, notably in the form of significant unrealised forex losses amounting to N81bn. This was attributable to the continued devaluation of the naira, closing the quarter at N1,351/$1. Despite this setback, recent trends suggest a reversal, with the naira exhibiting signs of stability in recent weeks, offering a glimmer of hope for potential exchange rate gains in the last quarter of the fiscal year.

“Looking ahead, the board remains confident in the company’s well-crafted strategy. The board is committed to continuously evaluating this strategy in response to the evolving business landscape, to deliver returns to its shareholders and create long-term value for all stakeholders,” the brewer maintained.

The Managing Director/CEO of Guinness Nigeria Plc, Adebayo Alli, said, “While the current macroeconomic environment will continue to present challenges, I am confident in the resilience of our business and our ability to navigate the volatility.

“Our focus remains steadfast on innovation and stepping up operational excellence to meet our consumers’ evolving tastes and preferences. Led by our strategic vision that prioritises long-term sustainability and shareholder value, we are poised to emerge even stronger.”

For its half year, Guinness Nigeria posted revenue of N142bn, a growth of 20 per cent over the previous year on the back despite a challenging macro-economic environment, characterised by a decline in consumer spending due to escalating inflation, continuous naira devaluation and, reduced cash in circulation.

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