BREAKING: Nigeria Breweries Incur N70.6 Billion In Forex Losses [DETAILS]—-Nigeria Breweries Plc reported an exchange rate loss of N70.6 billion for the second quarter of the year ended June 30th, 2023.
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This is according to the information contained in its just published interim report for the first half of the year.
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Key highlights 2023 Q2
- Net revenue N154 billion +13% YoY
- Gross Profit N68.4 billion +21.5% YoY
- Operating profit N26.6 billion +119.7% YoY
- Net Finance Cost N77 billion +970.8%
- Pre-tax lossN50.2 billion
- Gross margins 44.4% versus 41.3% YoY
- Operating profit margins 17.3% versus 8.9% YoY
- Working capital -N318.6 billion
- Retained earnings N35.5 billion versus N80 billion (2023 Q1)
- Loss Per Share N4.6
Insights: The losses were a result of the unification of the exchange rate which has led to forex losses upon the revaluation of its dollar-denominated loans.
- The company reported a net loss on foreign exchange of N70.6 billion taking the year-to-date exchange rate loss to N85.2 billion.
- The losses contributed to a massive N47.7 billion reduction in net assets.
- Important to add that the losses did not impact cash as the company still has a healthy cash balance of N34.9 billion.
- However, its negative working capital suggests it has to find money to repay its loans when they fall due within a year. It could also restructure the loans.
- The current losses are likely to impact full-year profits considering that NB also reported a profit after tax of N13.1 billion last year (2022).
- NB has so far reported back-to-back losses in the first two quarters of the year after reporting a loss before tax of N17.4 billion
