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Monday, 31 October 2016 06:58

Guinness posts superlative 1st Quarter revenue performance

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Peter Ndegwa, Managing Director/CEO, Guinness Nigeria Peter Ndegwa, Managing Director/CEO, Guinness Nigeria Credits: Olayinka Edmond

Guinness Nigeria Plc has declared 6% revenue increase for the first quarter of its financial year ended 30 September, 2016. The company said the increase was driven in part by contributions from its new mainstream and international premium spirits business as well as the continuing growth of its value brands.

Guinness Nigeria had in September announced its first set of results combining sales from both beer as well as International Premium Spirits (IPS) like Johnnie Walker and Baileys, following its acquisition of distribution rights from its parent company, Diageo, in January this year. The company reported revenues of N102bn its financial results for the period ended June 30, 2016 resulting in an overall Loss After Tax of N2bn when compared to the same period last year.

In the latest financial statements released to the Nigerian Stock Exchange over the weekend, record showed that the company had a Loss After Tax position of N2.2bn in the period.
Peter Ndegwa, Managing Director/CEO, Guinness Nigeria, said the revenue growth was in spite of continuing challenges in the operating environment. “The environment remains tough but we have seen contributions from our mainstream and international premium spirit brands as well as continuing growth of Satzenbrau”, Ndegwe said.

The MD added: “These were the key drivers of the 6% revenue growth recorded for the quarter. Our cost of sales was impacted by the high inflationary environment and continuing currency devaluation leading to a reduction in operating profit. The higher finance cost in the quarter is due to the impact of unrealized foreign exchange losses as a result of the currency devaluation.
“Going forward, innovation will continue to be a big part of our strategy us as we look to deepen our participation in the mainstream and value segments. We will also continue to invest behind our brands with a key focus on building the right portfolio for future growth and re-shaping our organization to take advantage of what is likely to continue to be a challenging market in the short to medium term” he added.
Citing long term commitment to the Nigerian market as a key driver, Guinness Nigeria recently announced a further GBP12M of investments in Nigeria as it plans to commission a new spirits manufacturing line in its Benin plant in the coming weeks.
Guinness explained that this investment will give a big boost to the company’s ambition to source 75% of its production raw materials locally in the next two years.

Additionally, at the beginning of October, Guinness Nigeria commissioned a new water project in a community in Benue State as part of its Water-of-Life programme, which in turn is one pillar within the company’s broader community investment agenda.

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