NIGERIA – Guinness Nigeria Plc, a leading beverage and alcohol company in Nigeria and a subsidiary of Diageo Plc, has announced its unaudited results for the first half year period ended December 31, 2019.
The results, which were released to the Nigerian Stock Exchange (NSE), showed that revenue increased one per cent versus the prior comparable period as strong growth in the second fiscal quarter mitigated the decline from the first quarter.
Growth was mainly driven by strong double-digit growth in brand Guinness and mainstream spirits.
Together with growth in the RTD segment, this mitigated the impact of increased excise duty, and the impact of reduced exports on malts.
The cost lines grew in low single digits as improved productivity and volume driven cost absorption mitigated inflationary pressure.
The company’s marketing increased as it continued to focus on growing brands in line with strategy.
Operating profit declined by N1.1 billion (US$3.04m) mainly due to the impact of the excise duty increase. Profit before tax decreased by N1.9 billion (US$5.24m) driven by an increase in net financing costs related to short term loans.
Speaking on the announcement, Mr. Baker Magunda, Managing Director/CEO, Guinness Nigeria Plc, said: “In the half year ended December 31, 2019, Guinness Nigeria delivered results that reflected a very strong second fiscal quarter performance despite continued regulatory, competitive and inflationary challenges in the operating environment.
Strong growth in Guinness, spirits and RTDs together with cost benefit from various productivity initiatives has helped to mitigate other risks.”
“I am pleased that revenue growth is in line with our strategy driven by better commercial execution and innovations. Within the period, we continued activating several innovations such as Guinness Smooth, Guinness Gold, Baileys Delight, Orijin Gin, Singleton and Johnnie Walker Green label.”
“These have contributed significantly to the growth. Despite the increase in excise duties on beer and mainstream spirits, the competitive environment was such that there was lack of pricing opportunities in the period to mitigate this.”