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First Quarter profit fall at International Breweries as input costs rise

First Quarter profit fall at International Breweries as input costs rise

BUSINESS, New Products, News, NIGERIA, Nigerian state programs, wazobia companies
International Breweries Plc reported a profit decline of 18% for the first quarter of 2017/2018 financial year despite seeing a record 37% surge in sales to N9.4bn, from N6.9bn. The company which makes Trophy Lager and Betamalt said that profit fell to N1.4bn, from N1.7bn in 2016. The brewer which is owned by beer giant AB InBev blamed high input costs for the drop in profit, driven by double digit inflation rate and high foreign exchange rates. Cost of sales rose 48% to N5bn, from N3.4bn. The firm said that operating income grew 37% to N2.3bn in the three months to the end of June while net finance cost declined 73.2% to N772m from N2.9bn. International Breweries announced in early June that it was exploring merging with Intafact Beverages Limited and Pabod Breweries Limited,...

Seven-Up losses pile up as finance charges skyrocket

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Seven-Up Bottling Company Plc (“SBC”), the bottler of PepsiCo brands of soft drinks in the country, on Friday reported a net loss of N2.5bn for the first quarter of its 2017/2018 financial year (Apr – Jun) despite recording nearly 20% sales growth of N31bn from N27bn in the previous year. The loss adds to the company’s woes which had reported a N10.7bn loss in June for the 2016/2017 financial year. The company cited skyrocketing net finance cost as the reason for the first quarter loss. Finance charges rose a record 85% to N1.8bn, from N961m in the same period a year ago. The firm has seen its fortunes erode due to higher input costs, driven by foreign currency headwinds which have made cost of imported raw materials expensive. Naira devaluation and inflation also weighed on the company’s

Heineken’s profits soar on zero-alcohol beer, warm European weather

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Heineken N.V. on Monday reported a 49% profit growth in half-year, helped by its new zero-alcohol beer introduced in Europe in May and a warmer weather in Europe. The company said that half-year profit to the end of June rose to €871m ($1.02bn), from €586m in the previous year. “We delivered strong results in the half-year, with all four regions contributing positively to organic growth in volume, revenue and operating profit,” CEO Jean-Francois van Boxmeer said. Heineken launched an alcohol-free version of its namesake brand in Europe in May, and the firm said the results “already looks promising”. Brewers earn higher profit margins from non-alcoholic beer because they are exempt from excise tax and also sell at a premium. The company said that beer volumes in France, Italy, Spain and Por

Nestle Nigeria’s half-year profit boosted by revenue growth, lower finance cost

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Nestle Nigeria Plc, reported a nearly 3000% increase in profits for the first-half of 2017. Net profit rose to N16.5bn from N535m in 2016. The company which makes products such as Milo cocoa drink and Nescafe coffee, among others said that profit was boosted by a 54% surge in revenue to N121.9bn, from N80bn in the previous year. Net income also benefited from price increases taken in 2016 which carried over to the second quarter and lower finance charge which dropped 84% in the period to N2.2bn, from N14bn in 2016, thanks to an improving economy and foreign exchange liquidity. Cost of sales grew 48% in the period, driven by double-digit inflation and a weakened Naira. Nestle remarked in the first quarter that the marked increase in revenue is a testament that the company’s brands still enj

Champion Breweries returns to growth with 9% profit rise in half-year

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Champion Breweries Plc, the Akwa Ibom-based brewer reported a 9% growth in net profit for the six months ended 30th June. The company’s net earnings rose to N86m from N79m in the previous year. In the three months to the end of June, profit soared 114% to 47m, from N22m. The profit rise came on the back of a 25% surge in sales in the six months to end of June as sales reached N2.3bn from N1.8bn in 2016. At the same time, cost of sales grew 33% reflecting higher input costs and inflation. However, the firm kept a lid on expenses as selling and administrative expenses stayed nearly the same from the previous year. Champion Breweries is majorly owned by Raysun Nigeria Limited, a wholly owned subsidiary of Heineken N.V. The brewery was first acquired by Heineken N.V. in 2010 from Sona Group an

Nigerian Breweries sustains momentum as half-year profit surge 24%

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Nigerian Breweries Plc, said on Friday that the benefits of the price increases it took in 2016 to mitigate the effects of skyrocketing inflation and foreign currency challenges continued into its first-half results. The company declared a 15% growth in revenue for the first six months of its financial year. Sales grew to N181bn, from N157bn from the previous year. However, higher input costs contributed to a 28% increase in overall cost and expenses, which were the result of double-digit inflation and a challenging operating environment. The brewer notes that its continued focus on productivity efficiencies as well as one-off ‘Other income’ and a lower net finance charge in the period boosted profits 24.4% to N23.8bn, from N19bn in 2016. NB warns that the operating environment remains cha

Cadbury Nigeria slides to record N766m loss in half-year

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Cadbury Nigeria Plc, the bournvita maker on Wednesday reported a half-year loss of N766m for the period ended June 30. In the same period a year ago, the company recorded a profit of N147m. Despite growth in revenue of 16.9%, rising cost of sales which grew 33% in the period to N13bn, from N9.8bn, driven by inflation and higher foreign exchange rates had an adverse impact on gross profit, and on net finance cost, leaping 348% to N274m. Cadbury Nigeria Plc is a subsidiary of Mondelez International Inc, a U.S.-based global beverage and confectionary company. The firm manufactures three categories of products: Refreshment Beverages, which includes Cadbury Bournvita and Cadbury 3-in-1 Hot Chocolate; Tom Tom confectionery; and Intermediate Cocoa Products, consisting of cocoa powder, cocoa cake ...