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Market Digest Nigeria

Business

Guinness Nigeria recorded N17.2b loss in year end

The economic headwinds impacted the profit of Guinness Nigeria Plc during the current operating year of the company.

Making this disclosure at the weekend was the Chairman, Board of Directors Babatunde Savage. He spoke at the 70th annual general meeting (AGM) of the company.

According to the company’s audited results for the period ended 30 June, 2020, it showed a 21% reduction in revenue from the significant impact of COVID-19 lockdowns and other induced economic challenges.

While commenting on the outcome of the yearend, Savage said the year 2020 was a very challenging year not only for the company but for the manufacturing sector at large.

“But as a forward-looking company, we were still able to minimize our risk exposures and maintain a sustainable performance on all our alcoholic and non-alcoholic beverages portfolio,” Savage noted.

“Guinness Nigeria has always remained resolute with our comprehensive and robust strategy by making rightful investments of shareholders’ funds but our profit was impacted by a number of one-off accounting adjustments totaling N17.2b, as well as volume declines due to the prevailing economic and Covid-19 impacted conditions.”

He further disclosed that the task before the company in the new financial year is to drive its strategic objectives to bring the company back into profitability.

Savage affirmed that despite predictions that the coming year is forecast to be challenging globally due to the new normal, “we believe we have experienced our full share of the impact and are now geared to go back to profitability,” he assured.

Managing Director, Guinness Nigeria Plc Baker Magunda expressed his confidence in the company’s  outlook for 2021 emphasising that some key strategic decisions of the company during the Covid-19 pandemic assures of a real and forward-driven return to stabilised operations.

Despite the fact that demand was also gravely impacted by reduced consumer income, unemployment concerns due to the shutdown of a large number of businesses, and increases of VAT and excise throughout the year, Magunda assured that the company’s reaction to the challenges presented by the Covid-19 lockdown in Q4 was centered around reducing risk to the business by focusing on cash delivery, reducing distributor inventories, and fast-tracking the ongoing distribution transformation project for efficient sales operations.

“The year under review witnessed the launch of Guinness Smooth; an exciting new variant of the Guinness products to expand profitability for the brand, while catering to a younger, vibrant demographic,” he added.

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