By Dipo Olowookere
Before now, the Nigerian beer market had always been dominated by Nigerian Breweries and Guinness Nigeria. However, that seems to be changing gradually with the growing presence of International Breweries in the market.
Earlier this year, when federal government announced that it would increase excise duty rates for alcoholic beverages, tobacco and others, many consumers feared that the additional cost would be passed to them.
But since the new approved excise duty rates came into effect in June 2018, most beer makers have found it difficult to hike the price of their products at the market.
Not many may know that the big players had allegedly planned to raise the price of their products, but International Breweries, which has flagship products like Trophy Lager Beer and Budweiser, the official beer of the 2018 FIFA World Cup in Russia, frustrated this move.
Few months ago, International Breweries officially commissioned its factory in Sagamu, Ogun State and gave it the opportunity to flood the market with its products.
“This boosted supply, constrained volume growth and forced key competitors (Nigerian Breweries (NB) and Guinness), to hold-off plans to pass on the burden of the new fix charge on beer to consumers,” analysts at United Capital Research said.
Business Post reports that the excise duty has continued to affect the performance of brewery companies in the country and Nigerian Breweries even admitted that its revenue dropped because of this.
“The new excise duty regime which came into effect in June and the consequent effect of it, adversely impacted the Third Quarter results,” the Secretary/Legal Adviser of Nigerian Breweries Plc, Mr Uaboi Agbebaku, was recently quoted as saying while reacting to the Q3 results of the brewery giant.
In the results, the firm’s revenue declined by 6.5 percent year-on-year to N238.1 billion, while PAT tumbled 38.4 percent to N14.8 billion.
Notably, Nigerian Breweries reported a negative operating profit of N3.9 billion in Q3-18 amid volume pressures.
Similarly, Guinness Nigeria’s 3-month revenue also weakened 3.3 percent year-on-year to N28.9 billion on weaker volumes, although PAT recovered significantly due to improved finance cost.
On the contrary, International Breweries sustained an aggressive quarter-on-quarter topline growth as its Q3-18 standalone revenue came in higher at N30.2 billion, the highest in the last four quarters.
“Overall, we see further pressure on Nigerian Breweries and Guinness Nigeria’s numbers going forward,” United Capital Research said.
Stanbic IBTC Enlightens Investors on Available Safe Investment Options
By Ashemiriogwa Emmanuel
Following the strokes of economic uncertainties from the COVID-19 pandemic, Stanbic IBTC Asset Management, a subsidiary of Stanbic IBTC Holdings Plc, recently organised a webinar to proffer guidance on investing in uncertain times.
The webinar via Instagram was themed Investing in Uncertain Times and experts at the Stanbic IBTC enlightened the investing public about the available transparent and safe investment options.
Some of the in-house were Ms Fadekemi Obasanya, Head Investment Management and Ekene Nwaokoro, Fund Analyst.
In her presentation, Ms Obasanya emphasised the importance of gaining needful knowledge from investment professionals about the best investment options per time.
She also pointed out the various investment options offered by Stanbic IBTC which both current and prospective investors can take advantage of, leveraging on the well-informed financial guidelines provided by the organisation.
She said some of the investment options include Stanbic IBTC Money Market Fund, Stanbic IBTC Dollar Fund, Stanbic IBTC Enhanced Fixed Income Fund, Stanbic IBTC Bond Fund, among many others under the mutual funds.
Ms Obasanya further stated that many people become victims of fake investment platforms due to misinformation and indiscipline, urging investors to do due diligence before parting with their funds.
“A lot of people fell prey to fake investment platforms in the previous year. It is wise to stay disciplined and informed about credible investment outlets to avoid losing money, as the main objective of the investment is to generate regular income and capital appreciation.
“People need to be mindful of the type of investment they put their money in. This is why we designed a tool called ‘InvestBeta’ for intending investors to identify their risk appetite, which simply means the amount of risk they are willing and able to take, as well as the available investment options that can help them achieve their investment objective.
“There are also well-experienced financial advisors on standby to help investors decide on the most suitable options for them,” she said.
Also discussed at the session was the advantage of investing in the Stanbic IBTC Dollar Fund, a dollar-denominated mutual fund, which was a response to how investors can hedge against Naira devaluation.
Individuals were educated on the fundamentals of investing and viable investment options, especially amid an unstable economic terrain.
Capital Importation into Nigeria Falls to $875.6m in Q2 2021
By Aduragbemi Omiyale
Nigeria has recorded a quarter-on-quarter decline of 54.06 per cent in the total value of capital importation into the country in the second quarter of 2021, the National Bureau of Statistics (NBS) has revealed.
In a report released by the agency, it was disclosed that the FX inflows from April to June 2021 stood at $875.6 million in contrast to $1.9 billion recorded in the first quarter of this year.
On a year-on-year basis, the capital importation went down by 32.38 per cent as the inflows in the same period of last year was $1.3 billion.
Business Post observed that the decline in the period under review was because of lower inflows from foreign direct investments (FDIs), foreign portfolio investments (FPIs) and other investments.
However, in the report, the stats office said the largest amount of capital importation by type was received through portfolio investment, which accounted for 62.97 per cent ($551.4 million) of total capital importation, followed by other investment, which accounted for 28.13 per cent ($246.3 million) of total capital imported, with FDIs accounting for 8.90 per cent ($78.0 million) of total capital imported in Q2 2021.
By sector, capital importation by banking dominated in Q2 2021, reaching $296.5 million of the total capital
importation in Q2 2021, followed by financing with $205.9 million and shares with $194.6 million.
By source of the capital investment, the United Kingdom was on top with $310.3 million, accounting for 35.43 per cent of the total capital inflow in Q2 2021.
It was trailed by South Africa with $212.4 million and the United States with $83.4 million and by destination, Lagos State emerged as the top destination of capital investment in Nigeria in Q2 2021 with $780.1 million, contributing 89.09 per cent to the total capital inflow in Q2 2021 and by bank, Stanbic IBTC Bank Plc emerged at the top of capital investment in Nigeria in Q2 2021 with $310.2 million, accounting for 35.43 per cent of the total capital inflow in Q2 2021.
Standard Chartered Bank followed by attracting $282.4 million, while Citi Bank attracted $94.2 million in the second quarter of this year.
PenCom Drags 120 Firms to Court for Pension Act Violation
By Adedapo Adesanya
The National Pension Commission (PenCom) has disclosed that it was in court with about 120 companies that have refused to comply with the dictates of the 2014 Pension Reform Act (PRA).
The Director, Corporate Communications of the commission, Mr Peter Aghahowa, stated this in Lagos at the 2021 PenCom workshop for journalists in Lagos.
According to him, the organisation was working assiduously to ensure all pension laws as they affect various policies are totally complied with.
He noted that compliance varies according to the sector, adding that recovery agents have been engaged to ensure that funds that ought to be remitted to PenCom are not diverted under any guise.
“For the private sector, we engaged recovery agents. By the PRA, any company with more than three workers must key into the Contributory Pension Scheme (CPS).
“So, the recovery agents have been empowered. Once they check the books of companies, they will determine their liabilities.
“We have the employee and employer portion remittances. For those not remitting at all, there is a penalty.
“We have 120 cases in court and these are organisations we tried to work with and they were just recalcitrant.
“Going to court is the last resort because the goal is for the money to the RSAs. We always try to engage.
“In states, they have to enact and implement the CPS. We work with them in coming up with a bill and setting up a pension bureau.
“Most states have not implemented this well. In enforcing compliance here, you should tread softly. Accrued rights have been paid up”, he said.
The agency has, therefore, called for compliance on contributory pension remittances by employers across the country.
On her part, the PenCom DG, Mrs Aisha Dahir-Umar, disclosed that the commission has deepened technological innovation as it seeks to navigate through the challenges imposed by the pandemic.
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