Guinness Nigeria : 25 Oct 2023Q1 F24 Press Announcement
October 25, 2023 at 01:13 pm EDT
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STATEMENT TO THE NIGERIAN STOCK EXCHANGE AND SHAREHOLDERS
ON THE UNAUDITED FINANCIAL RESULTS FOR THE THREE MONTHS
ENDED 30 SEPTEMBER 2023
The Directors of Guinness Nigeria Plc hereby announce the company's unaudited results for the period ended 30 September 2023.
3 Months Ended
3 Months Ended
Var vs. LY
30 September 2023
30 September 2022
N
'000
N
'000
%
Revenue
59,536,477
52,849,881
13%
Cost of Sales
(41,398,835)
(34,610,404)
20%
Other income
1,395,931
660,382
111 %
Marketing expenses
(4,552,361)
(4,897,906)
-7%
Distribution expenses
(3,761,499)
(4,516,095)
-17%
Administrative expenses
(3,345,581)
(3,580,995)
-7%
Operating profit
7,874,132
5,904,863
33%
Net finance costs
(4,056,408)
(1,862,487)
118%
Profit before taxation
3,817,724
4,042,376
-6%
Tax
(1,221,671)
(1,293,562)
-6%
Profit after tax
2,596,053
2,748,814
-6%
Comments
In the quarter ending September 30, 2023, Guinness Nigeria achieved a strong 13% growth in revenue, demonstrating resilience amidst a challenging macro-economic environment marked by rising inflation, currency devaluation, the aftermath of fuel subsidy removal, and security concerns that led to a reduction in consumer spending.
The revenue growth was primarily propelled by inflation-led pricing adjustments and an optimized product mix driven by premiumization. The company also drove sales by intensifying its consumer engagement activities, enhancing its route-to-consumer strategy to expand outlet coverage, and harnessing the power of its digital capabilities. The strongest revenue growth was observed in key categories such as APNAD and Ready-to- Serve, while other categories experienced more modest growth rates.
Despite the strong top-line growth, gross profit remained flat, and gross margins declined in comparison to the previous year, primarily because cost of sales growth outpaced revenue expansion. This was mainly due to the inflationary impact of currency devaluation, which could not be fully offset by price increases.
However, by focusing on cost-saving initiatives and enhancing operational efficiencies, the company reduced operating expenses compared to the previous year, and generated a 33% growth in operating profit.
Unfortunately, the continued depreciation of the Naira resulted in a significant unrealized forex loss in the income statement, and profit before tax declined by 6%.
Despite the significant macro-economic challenges facing the company, the Board maintains unwavering confidence in the company's well-devised strategy. The Board is committed to continually reviewing this strategy in response to the shifting business landscape, to sustain value creation for all stakeholders over the medium and long term.
By order of the Board.
ROTIMI ODUSOLA
Company Secretary
FRC/2016/NBA/00000015186
Dated this 24 October 2023
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Disclaimer
Guinness Nigeria plc published this content on 25 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 October 2023 17:12:22 UTC.
Guinness Nigeria Plc is the Nigerian leader in producing and marketing alcoholic beverages. The group's products, including primarily spirits, vodkas, beer and malted beverages, are sold under the Guinness Foreign Extra Stout, Guinness Extra Smooth, Malta Guinness, Malta Guinness Low Sugar, Harp Lager, Dubic Lager, Dubic Dark Ale, Smirnoff Ice, Satzenbrau Lager, Snapp, Top Malt, Alvaro, Master's Choice, Orijin Spirit Mixed Drink, Orijin Bitters brands, etc.
At the end of June 2023, the group had 6 production sites located in Nigeria (4) and Benin (2).