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Nigerian Breweries

Nigerian Breweries shareholders approve 80% Distell stake acquisition

Lagos, Dec. 22, 2023: The shareholders of Nigerian Breweries Plc have approved the acquisition of 80 per cent stake in Distell Wines and Spirits Nigeria Ltd. (Distell Nigeria) and the import business of Heineken Beverages (Holdings) Ltd.

This is contained in a statement signed by Mrs Sade Morgan, the company’s Corporate Affairs Director, on Thursday in Lagos.

The statement said the approval was given at the company’s Extraordinary General Meeting (EGM).

Morgan said with this development, the company’s board would proceed to conclude the transaction that would give Nigerian Breweries Plc the majority stake in Distell Nigeria.

“It would also give Nigerian Breweries the exclusive right to import, market, and distribute in Nigeria, Heineken Beverages’ wines, spirits, and ciders brands from South Africa, including the right to produce any of the imported brands locally,” she said.

The company’s Chairman, Mr Asue Ighodalo, explained that the acquisition aligned with the company’s vision to become a total beverage company, by adding wines and spirits to the product portfolio to cater to its diverse consumer needs.

“This acquisition is part of efforts to provide access to a complementary multi-category portfolio of fast-growing brands of wines and spirits market segment and capture significant growth opportunities in the wines and spirits segment of the brewing industry,” Ighodalo said.

The Company’s Secretary, Mr Uaboi Agbebaku, added that the consideration for the acquisition approved by the shareholders was about N7 billion.

Agbebaku revealed that the company had earlier received a confirmation from the Federal Competition and Consumer Protection Commission that the transaction would be treated as internal restructuring.

This, he said, meant that no further regulatory approval process would be required.

“The parties to the transaction will now proceed to agreeing the final terms and conditions of the sale and purchase agreement with the aim of concluding the transaction in the first quarter of 2024,” Agbebaku said.

Meanwhile, the National Coordinator of Progressive Shareholders Association of Nigeria, Mr Boniface Okezie, lauded the company for taking a decisive step to expand the business amidst the complex and challenging business environment.

The Distell Nigeria is involved in the local production of wines and ciders under license from Heineken Beverages.

With the acquisition, Nigerian Breweries will have access to both local production and importation of wines, spirits, and flavoured alcoholic beverages brands from South Africa.

They include brands such as Amarula Crèam Liquor, JC Leroux, Nederburg, Drostdy Haf, 4th Street, Bain’s Whiskey, Knight Whiskey, Chamdor wine ranges, Hunters and Savanna.

Nigerian Breweries

Nigerian Breweries records N274.03bn revenue

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Nigerian Breweries Plc has announced revenue of N274.03 billion for the first half of the year ended June 30, 2022.

The company made the disclosure in a statement signed by its Secretary/Legal Director, Mr Uaboi Agbebaku, on Sunday in Lagos.

Agbebaku said that the revenue represented a growth of 31 per cent when compared with N209.22 billion posted in the preceding period of 2021.

He said company also recorded a profit after tax of N19.08 billion against N7.86 billion in the corresponding period of 2021, an increase of 142.8 per cent.

Agbebaku said that basic earning per share stood at 237k as against 97k recorded in the comparative period.

He said the company’s increase in profit was driven mainly by top line growth resulting from its pricing strategy and better mix.

Agbebaku said that further analysis of the results revealed that cost of sales increased by 18.3 per cent to N155.35 billion from N131.34 billion in the corresponding period.

He added that marketing, distribution and administrative expenses rose by 44.6 per cent to N84.45 billion from N58.42 billion in 2021.

These expenses, Agbebaku said, were driven by the increase in commercial activities post COVID-19, rising diesel prices and higher wages arising from collective labour agreements.

He added that though interest expenses were lower, the net finance cost was higher due to foreign exchange losses arising from a higher cost of meeting foreign obligations to overseas partners.

“In spite of these challenges, our business continues to build momentum and deliver consistently profitable growth even in the context of a very challenging operating environment.

“Our best-in-class portfolio of brands provides a unique platform that positions us well to lead and grow the beer and malt category and drive superior long-term value creation,” he said.

He expressed the company’s commitment to continuously evaluate its financial position and business performance to ensure a strong balance sheet, while remaining dynamic in its response to operational challenges vis-à-vis the economy.

“In line with our certification and status as a great place to work company, we would also continue to prioritise the health, safety, and welfare of employees and partners,” he said.

Nigerian Breweries

Brewery boosts job creation with N78bn investment in raw materials

Nigerian Breweries Plc (NB) has invested N78 billion in the cultivation of raw materials in the country in the past five years to boost job creation.

NB’s Corporate Affairs Director, Mrs Sade Morgan, said this at a media parley in commemoration of the company’s 75th anniversary on Tuesday in Lagos.

Morgan said the company had invested N78 billion in cultivating locally sourced materials as well as sorghum and cassava value chain through commercial purchase and smallholder farming in the last five years.

She noted that the company had prioritised import substitution and accretion for foreign reserve with the N78 billion in investing and cultivating locally sourced materials.

Morgan added that the company invested N20 billion in sorghum value in 2021 through commercial purchase and smallholder farming.

She said the company had attained about 56 per cent in local sourcing of raw materials and 100 per cent backward integration in packaging.

“We have done about 56 per cent in local material sourcing but our packaging material is at 100 per cent; the challenge with the raw material is the availability of ingredients that go into making most of our products.

“So, that is an area where we will continue to pioneer as we did with sorghum with backward integration and investing to realise in Nigeria the products needed essentially for our products.

“But for now we want to be able to satisfy our consumers and give them the same quality of beer that they can get anywhere in the world,” Morgan said.

According to her, the company has injected 114 million dollars in capital investments and expansion projects in Ama Brewery to build a resilient economy.

Also speaking, the newly appointed Managing Director, NB, Mr Hans Essaadi, revealed that the company intended to invest significantly in capacity extension to meet its objectives and rising demands in the market.

“We have grown with Nigeria and it is clear that moving forward, we will continue to invest significantly in capacity extension to meet our objectives as well as demands in the market.

“We should expect much of these extensions in the east and northern parts of the country and our majority shareholder, Heineken, is committed to this and this is good as it will bring direct and indirect job opportunities for Nigerians,” Essaadi said.

Also speaking, the Chairman, Mr Kolawole Jamodu, said it was not an easy journey to be in existence for 75 years.

Jamodu attributed the company’s secrets to hard working staff with strong loyathy to NB.

The chairman added that investors, customers, shareholders as well as their international partners had supported the growth of the company in the past 75 years.

He said stakeholders should look out for more enticing surprises from the company in the years ahead.

Nigerian Breweries

Nigerian Breweries records N309.22bn revenue

Nigerian Breweries (NB) has posted N309.22 billion in revenue for the nine months ended Sept. 30.

The Company Secretary of NB, Uaboi Agbebaku, said this in a statement on Monday in Lagos that the revenue represents an increase of 32.13 per cent compared to N234.02 billion recorded in the corresponding period in 2020.

A breakdown of the audited result showed that profit for the financial year also grew to N8.47 billion from N7.1 billion, representing a 19.21 per cent rise.

Cost of Sales rose by 37.91 per cent to N198.74 billion from N144.1 billion achieved in the same period of 2020.

Similarly, marketing, distribution, and administration expenses grew by 27.20 per cent to N86.32 billion from N67.86 billion recorded in the same period of 2020.

The board of directors of the company has approved an interim dividend of N3.23 billion payable to shareholders at 40k each per ordinary share of 40k.

Agbebaku stated that the company remained committed to its strategy to deliver improved growth and remained dynamic in its response to challenges confronting the business as well as that of the economy, particularly in the face of COVID-19 pandemic.

He also explained that the company would continue to deploy cost-efficient measures to keep the balance sheet strong and healthy.

He said the company would ensure that the health, safety and welfare of its employees, customers and partners were protected.