Guinness Nigeria Plc, a subsidiary of Diageo Plc, has announced its audited results for the period ended 30 June, 2021 revealing a 110% increase in profit after tax, with double digit revenue growth across all key categories despite the impact of COVID-19 restrictions and ongoing economic challenges.
The audited results which were released to the Nigerian Exchange Group (NGX) at the financial year-end indicated that revenue increased 54% to N160bn versus the prior period of 2020. Operating profit increased by 177% benefitting from lapping significant impairments in the prior year and reduced administrative expenses arising from productivity savings.
Speaking on the announcement, Mr. Baker Magunda, Managing Director/CEO, Guinness Nigeria Plc said: “The performance of fiscal 2021 showed that the business delivered growth despite the challenging external environment characterized by COVID-19 restrictions and high inflation.”
“Revenues grew double digits across all key categories, particularly our strategic focus brands Guinness, Malta Guinness as well as our local and imported spirits. This was supported by improved product mix and headline price increases in key brands. Gross margins declined by 3% driven by inflationary pressure, a shift towards more expensive can products given at-home consumption trends, and forex devaluation impacting some materials,” Magunda explained.
The company however revealed that its net finance costs remained on a similar level as last year despite the lower debt position, due to the devaluation of Naira impacting the foreign currency denominated trading balances.
“Tax was impacted by a one-off historic charge. Profit before tax increased to N5,8billion, a 134% growth versus same period last year; and Distribution expenses increased by 22% versus last year behind volume growth due to efficiency improvements across distribution channels,” Managing Director/CEO, Guinness Nigeria Plc, Baker Magunda said.
“Going into the new fiscal year, we are conscious of the continued challenging operating environment with double-digit inflation and pressured consumer income spending. However, we will continue to focus on our strategy – optimising our route to consumers, innovating at scale to satisfy our consumers and improving cost control – as we continue to emerge stronger from the current crisis. We remain confident about the execution and resilience of our Total Beverage Alcohol strategy as a key driver of sustainable growth in the market,” he added.
The Chair of the Board of Guinness Nigeria Plc, Dr. Omobola Johnson assured that “the Board will continue to support Management in its efforts to sustain global best practices aimed at consistently delivering business growth for stakeholders. We remain confident that the strategy is comprehensive and robust, and that we are making the right investments in the company to ensure our long-term competitiveness,” she said.