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Guinness Nigeria Plc, foremost total beverage alcohol company in Nigeria and a subsidiary of Diageo Plc, has continued its path to sustained growth with an impressive 11% increase in its topline revenue, despite facing severe macro-economic challenges such as rising inflation, currency devaluation, temporary cash scarcity and insecurity, as stated in the audited results for the full year period ended 30th June 2023.
The results which were released to the Nigerian Exchange Group (NGX), revealed that the company reported a gross profit surge by 8% compared to the corresponding period in the previous financial year.
According to a statement from the firm, Guinness Nigeria Plc Managing Director/CEO, John Musunga, affirmed that the earnings and revenue growth resulted from strategic pricing and successfully deploying product mix across categories to counter cost inflation, and an optimized route-to-consumer approach that improved outlet coverage and the use of its B2B platform to improve distribution efficiency. The statement also noted that revenue growth was particularly strong for the strategic focus categories, Stout, Ready-to-Serve, and Mainstream Spirits.
“Although gross profit increased by 8% compared to the previous year, the cost of sales increase outpaced revenue growth primarily due to the prevailing macro-economic headwinds, specifically inflation, currency depreciation and the illiquidity of the forex market.”
“The intense volatility in the value of the Naira and the unavailability of forex in the official foreign exchange window adversely impacted the company’s financial performance. Specifically, the Central Bank of Nigeria floated all the exchange rate windows towards the end of Q4, causing a huge devaluation of Naira from N419 to N760 to $1, and this resulted in a massive N49.1B unrealized forex loss in the income statement”, Musunga said.
On her part, Dr. Omobola Johnson, the Board Chair of Guinness Nigeria Plc, assured “despite macro-economic challenges, the Board maintains confidence in the company’s well-considered strategy, anticipating continued strong value creation for all stakeholders in the medium to long term.”
“It is a credit to management’s impressive performance, that, despite the macro-economic headwinds, the business delivered N23.4 billion underlying operating profit for the year ended June 30, 2023”, she added.