Nigerian Breweries Invests N30.3bn In Plant, Equipment In Six Months

Nigerian Breweries Plc invested N30.3bn in property, plant and equipment during the first half of 2026.

The company’s unaudited financial statements for the six months ended June 30, 2026, showed that capital expenditure increased by about 8.2 per cent from N28bn recorded in the corresponding period of 2025.

The financial statements also revealed that Nigerian Breweries ended the half-year in a strong liquid position, reporting net cash of N74.63bn, compared with a net interest-bearing debt position of N74.32bn a year earlier.

The improvement reflected the elimination of outstanding borrowings, leaving the company with cash and cash equivalents of N74.63bn as of June 30, 2026.

The brewer’s capital expenditure commitments rose to N54.7bn at the end of June 2026, down from N85bn at the close of 2025, indicating that several projects remain under execution.

However, the increased investment came amid persistent cost pressures. Total cost of sales, selling, distribution and administrative expenses rose to N640.4bn during the period from N586.6bn in the corresponding period of 2025.

Raw materials and consumables remained the largest cost component, increasing to N340.9bn from N331.1bn a year earlier.

Advertising and sales expenses climbed to N71.9bn from N59.5bn, while distribution expenses increased to N68.0bn from N54.1bn.

Depreciation charges reflected the company’s growing asset base, rising to N40.0bn from N33.2bn.

Despite higher operating costs, finance expenses declined significantly. Finance costs, including the net foreign exchange impact, fell to N10.2bn during the first half of 2026 from N21.6bn in the same period of 2025.

The brewer’s effective tax rate for continuing operations increased to 40.54 per cent during the period, compared with 32.7 per cent in the corresponding period of 2025.

The group recorded Revenue of N804bn, representing a 9 per cent increase over the N738bn reported in the corresponding period of 2025.

The company’s Operating Profit grew by 8 per cent from N152bn in 2025 to N164bn, notwithstanding the increase in Selling, Distribution and Administration Expenses by 20 per cent.

The implementation of the new tax rates moderated the growth in Profit After Tax to 5 per cent, from N161bn in the first half of 2025 to N193bn in the current period.

In a statement signed by the Company Secretary/Legal Director of Nigerian Breweries Plc, Uaboi Agbebaku, the company continued to demonstrate resilience despite a challenging operating environment marked by macroeconomic volatility.

Agbebaku explained that the increase in the group revenue reflects the benefit of revenue management actions and strategic management initiatives.

“Gross profit margin expanded by 2 percentage points, with results from operating activities increasing by 8 per cent. Profit before tax went up by 18 per cent, supported by a 61 per cent reduction in net finance expense.

“The impact of the new tax rates limited the group’s net profit growth to 5 per cent “, he added.

He noted that the company has strengthened its financial position by improving liquidity and reducing financing pressure by maintaining zero borrowing.

He stated: “This strengthened cash position provides greater flexibility to respond to evolving market conditions while supporting ongoing business priorities. The Company has also now restored its retained earnings to a positive position,” he said.