Nigerian Breweries records 22% profit decline in half year as new tariff regime, weak sales, currency headwinds impacts sales

Nigerian Breweries Plc has said that the impact of the new excise duty rate on alcohol has shaved-off 22% from its net profit for the first six months of the 2018.

The company best known for its Star Lager beer said that profit after tax fell to N18.4bn, from N23.7bn earned in the first half of 2017. The impact was felt more in the second quarter when net profit dropped 33% to N8.22bn, from N12.3bn in the prior year.

Revenue also declined by 5% to N172.6bn, from N181bn in the previous year.

In a statement released by the company, it said that “In June 2018, a new excise duty regime and higher rate for beer were introduced, with further impact on affordability,” the statement read.

Heineken N.V., the parent company of Nigerian Breweries Plc noted in its release of mid-year results that beer volumes in Nigeria fell by the mid-single digits, impacted by the continued weak economic environment, destocking at the distributor’s level and competitive pressure. It also revealed that currency translation negatively impacted net revenue.

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