International Breweries, UAC, 12 Others Declare N38.77bn Loss in 2022

Kayode Tokede

Amid a challenging business environment, International Breweries Plc, UAC of Nigeria Plc, Ikeja Hotel Plc and 11 other companies listed on the Nigerian Exchange Limited (NGX) have declared a sum of N38.77billion loss in 2022 financial year as against N16.03billion loss declared in 2021 financial year.

Findings by THISDAY revealed that weak revenue generation, higher energy prices, foreign exchange illiquidity, commodity cost headwinds, severe weather, and overall inflationary pressures were key challenges that plunge these companies’ loss before tax In the year under review.

Seven out of the 14 companies in 2021 reported impressive profit before tax.  

Capital market analysts, thus, expressed that these companies anytime soon may not declare dividend payout, stressing that their stock prices have depreciated lately over poor corporate earnings.

So far, International Breweries, followed by UAC of Nigeria Plc reported the highest losses in 2022 as both companies battled high costs of operation, interest expense on bank loans and foreign exchange loss.

The breakdown revealed that International Breweries in 2022 financial year declared a loss before tax of N26.84billion as against N19.84billion loss before tax in 2021, while UAC of Nigeria announced N4.37 billion loss before tax in 2022 as against N4.11billion reported in 2021.

From profit & loss figures, International Breweries announced N218.65 billion revenue in 2022 from N182.3 billion in 2021 but the beer maker witnessed 29 per cent per cent increase in its cost of sales and N10.68billion finance cost in 2022 from N4.8billion in 2021 that eventually plunge its loss before tax to N26.84billion.

The reported revenue by the beer maker is the highest in 10 years, while loss before tax is the second highest since 2020 when the company announced N28.59billion loss before tax.  

Others companies with losses for two consecutive years are: Chams Holding Company reported N129.06billion loss before tax in 2022 from N493.03billion loss before tax in 2021; The Initiates Plc announced N43.37million loss before tax in 2022 from N62.24million loss before tax reported in 2021; Capital Hotel Plc reported N808.281million loss before tax in 2022 from N2.620million loss before tax in 2021;  Secure Electronic  Technology Plc announced N15.084million loss before tax in 2022 from N61.82million loss before tax in 2021; Tantalizer Plc posted N             264.091million loss before tax in 2022 from N214.821million in 2021 and FTN Cocoa  reported N430.88million loss before tax in 2022 from N1.48billion loss before tax in 2021. 

The Managing Director of the company, Theophilus Netufo, recently expressed optimism that the firm would sustain its prime position as the flagship of hospitality and tourism business in Nigeria.

According to him, “Since the new board came, and I was asked to supervise the company as Group Managing Director, with collaboration and support of the board, we had no choice but turn the company around.

“What we do, as strategy, is to set up the goal we want to achieve, how we will achieve it, and also remove hurdles and bottlenecks on the way. And ever since, things have been moving, in spite of economic challenges.”

He noted that the company had concluded plans to commence comprehensive refurbishment of the hotel to enhance its competitiveness in the industry.

Netufo also disclosed that the company would diversify into related businesses and develop products that would help generate more income and enhance profitability.

For UAC of Nigeria, it reported N4.37billion loss before tax in 2022 from N4.11billion profit before tax reported in 2021.

The diversified company reported N109.27billion revenue in 2022, an increase of eight per cent from N101.38billion in 2021. About 13.4 per cent increase in cost of sales to N95billion and 16.6per cent total operating expenses to N17.3billion affected the company performance in the year under review.

Other notable companies that moved to losses in 2022 was Ikeja Hotel with N3.36billion loss before tax in 2022 from N200.9millin profit before tax reported in 2021; NCR Nigeria Plc announced N801.9million loss before tax in 2022 from N317.48million profit before tax in 2021 and Union Dicon Salt Plc declared N44.96million loss in 2022 from N39.97million profit before tax in 2021.

In addition, SCOA Nigeria declared N525.08million loss before tax in 2022 from N526.46million profit  before tax in 2021;  Livestock Feeds Plc posted N781.39million profit before tax in 2022 from N565.13million profit before tax in 2021 and Neimeth International Pharmaceuticals Plc declared N388.05million loss before tax in 2022 from N365.28million profit before tax in 2021.