Nigerian Breweries blames fall in profit on forex, rise in inflation

The Board of Directors of Nigerian Breweries Plc on Monday blamed the 11 per cent decline in its Profit After Tax (PAT) of the first half of 2016 financial result on foreign exchange loss and rise in inflation.

The Breweries recorded a PAT of N19.06 billion for the half year ended June 30, 2016, which showed a decline of 11 per cent compared to N21.477 billion recorded in the corresponding period of 2015.

The Board said that the first half result was able to deliver top line growth with revenue increasing by 4 per cent compared to the first six months of 2015.

Mr. Uaboi Agbebaku, Company Secretary/Legal Adviser, in a statement said that rising inflation combined with higher inputs costs as a result of scarcity of foreign exchange, led to a flat operating profit compared with the preceding year.

Although, Agbebaku, said that the Board expects the operating environment in 2016 to remain challenging for the rest of the year, but added that the company remain focused on its twin agenda of Cost Leadership and Market Leadership supported by innovation and the Board remains positive on the Nigerian market for the medium and long term.

Despite the fall, the declared a revenue of N157.37 billion for the first half of 2016.

The unaudited and provisional results released to The Nigerian Stock Exchange (NSE) obtained by NEWSVERGE show that the amount represents a 4 per cent increase over the N151.67 billion declared in the corresponding period in 2015.

The results show that the results from operating activities of the Company improved by 0.10 per cent from N33.90 billion in the first half of 2015 to N33.94 billion in the corresponding period in 2016.

A further analysis shows that Profit Before Tax (PBT) dipped by 17.64 per cent from N33.99 billion in the period under review in 2015 to N25.52 billion in the same period in 2016 while Profit After Tax (PAT) dropped by 11.24 per cent to N19.06 billion in the current period from N21.47 billion in the same period in 2015.