Dike Onwuamaeze and Kayode Tokede

The Managing Director/CEO of Nigerian Breweries Plc, Mr. Hans Essaadi, yesterday hinted that foreign exchange volatility is expected to continue in 2025, stressing that President Donald Trump Import tariffs is expected to take tolls on Nigeria’s economy.

Speaking at the the company’s “Pre-AGM Media Briefing 2025,” which was held in Lagos, he noted that the company expects a positive economic outlook for Nigeria in 2025.

He noted that inflation was projected to ease due to a higher base effect, and normalisation of energy prices following subsidy removal.

He added that the rebasing of Nigeria’s Consumer Price Index (CPI) would create statistical effects, leading to lower headline inflation figures.

“The expansion of local refining capacity, notably from the Dangote Refinery and refurbished state-owned refineries in Warri and Port Harcourt, will reduce the foreign exchange impact on energy prices.

“Additionally, a reduced reliance on premium motor spirit (petrol) imports will ease pressure on foreign reserves, creating more balance in the payments system.

“The economy’s performance will largely depend on the Government’s ability to tackle key challenges.

“These include revenue generation, debt sustainability, fiscal discipline, monetary policy coordination, macroeconomic stability, security, and social welfare,” Essaadi said.

Addressing the commercial beverage market, Essaadi noted cautious optimism about consumer spending improving in 2025.

He said this would be driven by better macroeconomic conditions, a stable economic environment, and the introduction of a restructured minimum wage to boost workers’ earnings.

As consumer purchasing power strengthens and market conditions improve, he stated that Nigerian Breweries would leverage its market position to capitalise on rising demand.

Due to higher interest expenses and the impact of the devaluation of the Naira on its foreign exchange denominated payables, the multinational breweries company had a 34 per cent increase in its net finance costs that rose to N253 billion.

The NB recorded a historic N1.1 trillion group revenue in 2024 financial year, which is an outstanding 81 per cent year-on-year growth. The NB also grew its operating profit by 59 per cent, which was driven in part by disciplined cost management.

He explained that net finance costs surged by 34 per cent to N253 billion, mainly due to higher interest expenses and the foreign exchange impact on payables.

“This weighed heavily on the bottom line pushing up our net loss by 36 per cent to N145 billion,” he said.

Essaadi noted that the company’s results from operating activities soared by 53.7 per cent from N44.49 billion in 2023 to N68.403 billion in 2024.

He said the loss for the year 2024 stood at N144.338 billion, 36.5 per cent increment from the company’s loss of N105.769 billion in 2023.

According to him, the Nigerian Breweries’ share capital witnessed 201.5 per cent increase from N5.138 billion in 2023 to N15. 492 billion in 2024.

He explained that there was also 614.2 per cent surge in the company’s total equity from N65.17 billion in 2023 to N465.47 billion in 2024.

The MD explained that during the year under review, the principal activities of the company remained brewing, marketing and selling of lager, stout and non-alcoholic drinks.

He said the company’s 2024 results were shaped by a complex and challenging business environment, significantly impacting operations and livelihoods nationwide.

He said economic pressures, including high inflation rates and the devaluation of the naira, drove up operational costs and the price of raw materials.

He explained that Nigeria’s inflation rate soared to a near 30-year high of 34.8 per cent in December 2024.

“In spite of these hurdles, Nigerian breweries demonstrated resilience through strategic adaptations including a recapitalisation of the company through a rights issue.

“It was also resilient through increased local sourcing, innovation, and further diversification through the completion of the acquisition of majority stakes in Distell wines and Spirits Nigeria Ltd.

“Our ambition is to leverage diversity, promote equity and embed inclusion to create business value in a fast changing and complex environment, which positively impacts our customers and consumers and benefits the company,” he said.

Speaking during the press briefing, the Finance Director of NB, Mr. Bernardus A. Wessels Boer, said that the company no longer has significant FX debt in its balance sheet and has reduced its local debt as much as possible.

Boer disclosed that the local debt has dropped from around N600 billion to now around N200 billion.

He, however, added that “elevated interest rate still result in high interest cost.”

In addition, the Corporate Affairs Director at Nigerian Breweries, Mrs. Sade Morgan said “We are hosting this session as a precursor to our AGM to share with you all of the relevant information about our business and to strengthen our relationship with the media.

“We recognise that 2024 was a challenging year for the business in Nigeria and a lot of businesses in Nigeria.

“This was a fallout of the economic slump of 2023, followed by the narrow decline, and all of this also led to a cash crunch, along with the foreign scarcity, high inflation, and wealth crisis, and we all lived through it.

“In spite of these challenges, we shaped our organisation for transformational growth, to meet the needs of our customers and our consumers, all over Nigeria and even beyond.

“So we remain committed to our purpose, and are perfectly in the joy of true togetherness and inspiring a better world,” she said.