International Breweries Returns to Profitability on Resilient Consumer Demand

May 10, 2022
International Breweries financial statements

By Dipo Olowookere

One of the leading brewery companies in Nigeria, International Breweries Plc, posted impressive results in the first quarter of 2022, with both the top line and the bottom line recording significant growths.

It was observed that the strategies deployed by the board and management yielded results, with growth witnessed across its portfolios.

International Breweries operates in a very competitive market, coupled with macro-economic headwinds triggered by inflationary pressures, high operating costs and low purchasing power.

However, aggressive campaigns and commercial actions spurred resilient consumer demand for the company’s products, driving volume growth ahead of the industry as reflected in the hike in the administrative, marketing and promotion expenses to N12.1 billion in the period under review from N9.0 billion in the same period of last year.

Consequently, the revenue generated in the first three months of the year rose to N57.5 billion from N39.0 billion, while the cost of sales stood at N37.6 billion versus the N32.5 billion achieved in the corresponding period of last year, leaving the gross profit at N20.0 billion as against N6.5 billion reported in Q1 of 2021, indicating a 207.7 per cent increase.

Business Post reports that at the close of business on March 31, 2022, the brewer had a pre-tax profit of N1.9 billion compared with the pre-tax loss of N3.6 billion in Q1 of 2021 and a post-tax profit of N721.2 million in Q1 2022 versus the post-tax loss of N2.6 billion in the same period of last year.

Commenting on the performance of the firm, the Managing Director of International Breweries, Mr Hugo Dias Rocha, stated that, “Based on a consistent commercial strategy, we are growing ahead of our industry. We have continued our journey to profitability, which translates into strong results. We remain committed to creating value for our stakeholders consistently.”

“Building on top of the momentum of a strong FY 2021, our business started 2022 on a positive note. On the back of firm consumer demand for our brands; robust revenue management; and volumes growth ahead of the industry our revenue grew by nearly 50 per cent in 1Q22. We saw consistent growth across all our portfolios,” he added.

He said further that, “Keeping a focus on profitability, we have enabled our High-End Company brands to grow healthy in the market. Our global brand, Budweiser and our newest innovation, Trophy Extra Special Stout are on a growth path as part of the High-End growth of above 40 per cent.”

Dipo Olowookere

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

Mr Olowookere can be reached via [email protected]

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