Nigerian Breweries’ Half Year Profit after Tax Declines to N8.2 Billion

Goddy Egene

Leading brewing firm, Nigerian Breweries Plc has announced a profit after tax of N8 billion for the half year(H1) ended of 2018, showing a decline by 33 per cent, compared with the N12.317 billion recorded in the corresponding period of 2017.

An analysis of the results indicated that the company’s revenue dipped by five per cent from N181 billion in 2017 to N173 billion in 2018.

A further analysis of the performance showed that results from operating activities declined by 20 per cent from N39 billion in 2017 to N32 billion in the corresponding months in 2018, just as profit before tax also dropped by 19 per cent from N34 billion in 2017 to N28 billion in the period under review.

Company Secretary/Legal Adviser of Nigerian Breweries Plc, Mr. Uaboi Agbebaku, attributed the lower performance to the new excise duty introduced by the federal government. According to him, the new excise duty regime and higher rate of beer introduced in June 2018 further impacted on affordability in the period under review.

The government had approved an amendment to the excise duty rates for alcoholic beverages and tobacco with effect from June 4. And the Minister of Finance, Mrs. Kemi Adeosun said that the new excise duty rates were spread over a three-year period from 2018 to 2020 in order to moderate the impact on prices of the products. Adeosun said that the new excise duty regimes followed all-inclusive stakeholder engagements by the Tariff Technical Committee of the Federal Ministry of Finance with key industry stakeholders. According to her, the upward review of the excise duty rates for alcoholic beverages and tobacco is to achieve a dual benefit of raising the federal government’s fiscal revenues.

Meanwhile, gains by bellwether tickers such as Nestle Nigeria Plc, Seplat Petroleum Development Company Plc, FBN Holdings Plc and Nigerian Breweries Plc helped to sustain the upbeat at the stock market and lifted the Nigerian Stock Exchange (NSE) All-Share Index (ASI) by 0.19 per cent to close above 37,000 threshold yesterday. Although there were a total of 17 price gainers, lower than the 24 price losers, the NSE ASI closed higher at 37,017.78 following appreciation recorded by highly capitalised counters. As a result of the positive close, the year-to-date decline further improved to 3.20 per cent.