BankingBusiness

Guinness Nigeria’s revenue growth overshadowed by mounting losses

 

By Tunji Faleye

Guinness Nigeria Plc, a leading player in the Total Beverage Alcohol market has reported an impressive 111% increase in revenue for the quarter ending September 30, 2024, reaching N125.9 billion, up from N59.5 billion the previous year.

However, this growth has come alongside significant financial hurdles, with the company recording a N16.0 billion loss before tax. The company attributed its challenges to steep increases in operating costs, driven by inflation, currency depreciation, and rising input costs, which have weighed heavily on its profitability.

Despite innovative product rollouts and expanded consumer engagement efforts, the soaring costs of raw materials, packaging, and utilities have strained Guinness Nigeria’s margins. Dr. Omobola Johnson, Chair of the Board of Directors, emphasized the difficulty of balancing revenue growth with profitability amid a tough economic climate. She noted, “Our revenue reflects the strength of our brands, but escalating costs and currency volatility have significantly impacted our bottom line. We are committed to taking the necessary steps to improve efficiency and ensure long-term value for our stakeholders.”

The company reported a 170% surge in the cost of sales, which outpaced revenue growth and further narrowed operating profits. While a favourable tax position mitigated the losses, Guinness Nigeria ended the quarter with a loss of N12.1 billion. Girish Sharma, Managing Director of Guinness Nigeria Plc, acknowledged the strain that inflation and currency devaluation have put on the business, stating that the immediate focus is on improving efficiency to restore profitability. “Our goal is to bolster operational resilience and deliver greater value despite the challenging environment,” he added.

Looking forward, Guinness Nigeria’s leadership is implementing strategies aimed at cost management, operational efficiency, and local sourcing improvements to counteract these pressures. As Nigeria’s economic challenges persist, the company’s focus remains on stabilizing its financial health while leveraging its strong brand portfolio to position for sustainable growth.

Guinness Nigeria, is the foremost Total Beverage Alcohol company in Nigeria with a wide portfolio of brands catering to consumers of non-alcohol and alcohol beverages including Malts, Ready-to-Drinks, Spirits, Stout & Beers. Some of its well-known and well-respected brands include, Guinness Foreign Extra Stout, Guinness Smooth, Malta Guinness, Orijin Bitters, Dubic Malt, Gordons Pink Berry, Gordons Orange Sunset, Smirnoff Ice, Smirnoff X1 Choco Vodka, Smirnoff Pine-apple Punch, amongst others.

With a very clear ambition – “To be one of the best performing, most trusted and respected consumer products companies in Nigeria”, Guinness Nigeria delivers on its sustainability and responsibility commitments which are focused on three areas: Promoting Positive Drinking, Championing Inclusion and Diversity and Pioneering Grain to Glass sustainability. The company continues to be a champion for responsible drinking and community development.

Kindly like, share and leave your comments.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button