Guinness Nigeria is charting a new course and this time it is under new leadership. With the Tolaram Group now steering the ship and cost-saving measures like the halt in International Premium Spirits (IPS) imports, we are seeing strong signs of a turnaround. Our latest report, “Brewing a Comeback”, dives into the business’ 9M:2025 numbers and factors behind the company’s recovery. Guinness currently trades at a price/earnings (P/E) ratio of 26.06x, though slightly above the industry average ...
Just as we expected, Nigerian Breweries bounced back to profitability in Q1:2025. After the last two years of losses, the company swung back to profit in Q1:2025, thanks to strong sales, aggressive advertising, smarter cost controls, and less FX pain. Additionally, the company is not just brewing beer anymore. With full ownership of Distell Nigeria now in the bag, NB looks set to deepen its footprint beyond its traditional base and expand into wines, spirits and flavored alcoholic beverages. ...
2024 was a remarkable year for Nigerian Breweries Plc, as it made more than NGN1trn in revenue. However, just like many other consumer goods companies, rising inflation, a rapidly depreciating naira, and high interest rates continued to dampen its bottom-line profit, keeping it in the red zone. However, we are optimistic about the company’s growth in 2025, and it seems like recovery is really in sight for the company this year. To find out why and whether you should position in it, please rea...
Topline expands on price increases.In Q3’24, Guinness Nigeria demonstrated robust revenue growth, despite the prevailing macro challenges. The company delivered a satisfactory topline performance, driven primarily by increased pricing amid a decline in sales volume. Revenue for the quarter surged 44% y/year to ₦77.7 billion, as a result of this higher pricing.However, the company’s margins came under pressure due to rising costs. The jump in cost of sales outpaced revenue growth, rising by...
Cost of sales outpaces revenue growth. In Q1'24, GUINNESS saw an improved topline performance, reporting a revenue of ₦59.5 billion, representing a 13% increase y/y. This came as a result of sustained price increases. This was followed by a higher increase in costs of sales (19.6% y/y) to ₦41.4 billion. This led to gross profit margin dropping to 30% (Q1’23: 35%), bringing gross profit to ₦18.1 billion (down 10% y/y). Cost containment proves effectiveOperating expenses for Q1'24 amounted to ...
A director at Nigerian Breweries bought 2,250,000 shares at 41.300NGN and the significance rating of the trade was 69/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years...
Slow Q3 Performance Couldn’t Stop the Shine The overall trajectory of NB remains solid, evidenced by the 27.2% YoY rise in Revenue performance. We observed some level of adjustments in prices since the beginning of Q2, but the juries are still out on the volume component of the revenue data. The revenue direction was instrumental to improved gross and operating margin position as of 9M 2022. Nonetheless, the three months ending September 2022 were clogs in the firm’s operational performance wh...
In its recently released earnings results, despite favourable pricing, International Breweries reported only a 6% rise in Revenue, which when compared to the 36% y/y average growth seen in H1 showed the heavy impact of excise duties on the company’s topline. However, cost of sales grew by 14% y/y to ₦38.7 billion, dragging gross profit 18% lower y/y to ₦12.6 billion and gross margin 6ppts and 10ppts lower to 21% from 27% in Q3’21 and 31% in Q2’22. Even though operating expense remained sta...
Somber fourth quarter dampens FY earnings momentumAlthough the company had shown an impressive performance in the 9M period, the FY performance was below expectation as PAT (most evidently) increased by only ₦0.4 billion in the Q4 period, compared to an average of ₦5 billion for the preceding three quarters. The dismal Q4 performance was a combination of higher operating expenses and weaker demand, as consumers began to trade off against volumes in response to tougher product pricing and g...
In its recent H1’22 Earnings results, International Breweries PLC showed a 25% y/y rise in Q2’22 Revenue to ₦53.9 billion. We believe that the growth was spurred by industry-wide increase in prices, especially in the Malt and Lager segments, and given Trophy’s market leadership in the Lager space, we consider this the headliner for the company’s Revenue growth. However, volumes came in lower q/q, as Revenue declined by 6% in the period. This highlights the tradeoff consumers are increasing...
Consolidating on its Q1’22 performance, Nigerian Breweries’ half year earnings revealed a 143% y/y growth in bottom line to ₦18.7 billion (Vetiva: ₦22.8 billion), driven by a 77x q/q improvement in its Q2’22 PAT. This has resulted in a half year EPS of ₦2.32, compared to ₦0.96 in H1’22 and consistent with NB’s 100% dividend policy raises the half-year expected dividend payout to ₦2.32 per share. Q2 solidifies performance trajectoryDespite the stronger pricing implemented across board...
International Breweries PLC released its Q1’22 financial statements, where it reported a sizable 48% y/y growth in topline as well as a PAT of ₦0.7 billion (its second quarterly profit since the consolidation) from a loss of ₦2.5 billion the previous year. The impressive PAT performance was underpinned by significant growth in margin, as well as increased reported finance income.Like its counterparts in the brewery industry, International Breweries in the past two quarters raised prices ac...
Upbeat margins in Q3 propel earningsThe company's topline grew by 18% in the third quarter, with revenue reaching ₦50.3 billion (Vetiva: ₦53.7 billion). Spirits, which has witnessed significant growth across both the Mainstream (MSS) and International Premium (IPS) sub-segments and continues to produce significant margin, remains a major driver of the company's turnover. While we believe that volumes have improved y/y (especially with the company’s increased production capacity), we also b...
In the first quarter of the year, NB reported significant improvement in its performance, with topline and bottom-line expanding by 30% y/y and 78% y/y respectively. We believe that the growth in the beer maker’s Revenue came down to a mix of volume and price increases. The Malt segment, which has been gaining traction industry-wide may be responsible for the growth in turnover. Still, we recall that management indicated (as at FY’21) the success of its push for increased volumes from its ...
A director at International Breweries bought 8,346,021 shares at 5.000NGN and the significance rating of the trade was 58/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two y...
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
In its 9M’21 earnings release, Guinness Nigeria reported a 35% y/y expansion in PAT to ₦1.8 billion (Vetiva Estimate: ₦0.8 billion), driven by a significantly higher y/y revenue performance as well as cost-containment across some major expense lines. In Q3, Guinness’ topline grew 54% y/y to ₦42.6 billion, outpacing our expectation of 44% y/y (₦39.9 billion) and was mainly driven by the segments which the company has chosen to focus on strategically; Spirits, Malts and Stout (Guinness). Sp...
A disappointing end to the year Similar to what we saw in Q320, Nigerian Breweries (NB) recorded a strong YoY growth of 18% in their revenue which printed at N103 billion over Q420. However, cost of sales grew by an astonishing 42% which dragged gross profit down by 18%YoY to N28.74 billion. Despite a 14%YoY fall in OPEX, the sharp increase in cost of sales meant that EBIT fell 30%YoY to N7.11 billion. Higher finance costs led net finance expense higher by 67%YoY which in turn helped bring PB...
In this week's edition of the Weekly Cross-Asset Strategy Report, we give a recap of the equities, fixed income, currencies and derivatives markets' performance over the past week and our trading ideas for the coming week. Our Momentum, Income and Value equities portfolios continue to outperform the benchmark NSE 20 index. Performance of the Momentum and Income portfolios is ahead of all the benchmark indices including the Nairobi All Share Index (NASI) and Zamara Index. Genghis Trading Ideas ...
Guinness reported a surprising YoY growth in their revenue over Q221 (3 months ending in December) despite the muted holiday celebrations. However, their revenue performance was once again overshadowed by rising cost of sales (+4.2%YoY) which dragged gross profit down by 2.8%YoY. Further highlighting their issue with costs is the performance of their EBITDA which declined 12%YoY over H121 and now has a margin of 10.8% in H121 (vs13.1% in H120). Guinness are also facing financing cost pressure ...
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