Nigerian Breweries Takes Major Step to Boost Earnings

By Modupe Gbadeyanka

Probably worried by the disappointing outcome of its 2018 financial year performance, which saw the total revenue generated by the company reducing to N350.2 billion from N365.8 billion in 2017 fiscal year, the management of Nigerian Breweries has taken a major decision to improve things in the 2019 financial year.

In its 2018 results, the implementation of the new excise duty by federal government in the second half of the year had a negative effect on the company.

As part of efforts to improve this year, the brewery giant has signed a Solar Power Purchase Agreement deal with a company known as CrossBoundary Energy Limited.

The agreement is mainly for the installation and operation of a 650 kW solar plant located its Ibadan Brewery.

The solar energy plant will become operational this year, Nigerian Breweries confirmed in a statement signed by its Legal Director, Uaboi G. Agbebaku.

According to Nigerian Breweries, this project will “significantly” reduce the “current cost of power” at the factor, which is expected to reflect positively in the gross earnings of the firm.

“This landmark project is the first of its kind in Nigeria as it will supply 1GWh annually to the Ibadan Brewery at a significant discount to the current cost of power.

“It will also reduce the Brewery’s CO2 emissions by over 10,000 tonnes over the lifespan of the plant.

“In addition to helping to power our world-class Brewery in Ibadan, the solar plant will enable us to deliver on our ‘Brewing a Better World’ initiative. This will support our parent company’s (Heineken NV) global ‘Drop the C’ programme for renewable energy which is aimed at growing production-related energy sourced from renewables from the current level of 14% to 70% by 2030.

“The solar plant will equally lead to the creation of jobs in the engineering, construction and maintenance sectors, while supporting the Nigerian Electricity Regulatory Commission’s target of having 2,000MW of power capacity from renewables by 2020.

“NB will continue to create partnerships aimed at adding value to its business, the Nigerian economy and the environment,” the statement said.

Business Post had earlier reported that in the 2018 financial statements of Nigerian Breweries, profit after tax went down by 41.2 percent to N19.4 billion from N33 billion, while the profit before tax declined to N29.4 billion from N46.6 billion a year earlier.