NIGERIA – Guinness Nigeria, a Nigerian-based subsidiary of Diageo Plc, has been hit by the cost of sales increase in the Full Year 2023 that has outpaced revenue growth primarily due to the prevailing macro-economic headwinds, specifically inflation, currency depreciation, and the illiquidity of the forex market.
The brewery, which is the first Guinness operation outside Ireland and Great Britain has sustained growth with an impressive 11% increase in its topline revenue, despite facing severe macro-economic challenges.
For the full-year period ended 30th June 2023, the company reported a gross profit surge of 8% compared to the corresponding period in the previous financial year.
“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,” said Guinness Nigeria Plc Managing Director/CEO, John Musunga.
“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 US$1, and this resulted in a massive N49.1B unrealized forex loss in the income statement.”
He affirmed that the earnings and revenue growth resulted from strategic pricing and successfully deploying product mix across categories to counter cost inflation.
The move also optimized the route-to-consumer approach that improved outlet coverage and the use of its B2B platform to improve distribution efficiency.
Musunga also noted that revenue growth was particularly strong for the strategic focus categories, Stout, Ready-to-Serve, and Mainstream Spirits.
Dr. Omobola Johnson, the Board Chair of Guinness Nigeria Plc, assured that despite macroeconomic 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.
Guinness Nigeria strengthens diversity on the board with the appointment of Ms. Joan Hodgins
Meanwhile, the company announced the retirement of Mr. Dayalan Nayager from the Board of Guinness Nigeria Plc with effect from 30th June 2023 and the appointment of Diageo’s Global Talent Director, Ms. Joan Hodgins as a Non-Executive Director and Vice Chair of the Board of Guinness Nigeria Plc with effect from the 1st of July 2023.
Mr. Dayalan Nayager assume expanded responsibilities at the Executive Group Management level within the organization’s parent company Diageo Plc.
Guinness Nigeria said the appointment of Ms. Hodgins will also see the strengthening of the Board with the vast experience she brings in the area of human resources management, people, and talent while also improving diversity on the Board.
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