We Remain Poised To Maintain Leadership In Brewery Market- Nigeria Brewery

Nigerian Breweries (NB) Plc has said it remains poised to maintain its leadership in the brewery market via its cost and value strategies.

This is even as it said it recommended a total dividend of N12.9 billion, which will be N1.60 per share for the 2021 financial year and will seek shareholders’ approval of a share for cash dividend election scheme at its forthcoming Annual General Meeting (AGM).

Speaking to newsmen during its Pre-AGM media briefing in Lagos on Thursday, the Chief Executive Officer, NB Plc, Hans Essaadi, noted that despite the challenging operating environment, the company remained dynamic with its processes and was able to remain resilient and grow from strength to strength.

Essaadi, however, noted that the cost of living is currently high and together with increased price in the cost of fuel particularly diesel is slowing the growth of Fast-moving consumer goods (FMCG) sector.

He also lamented that the FX crisis has been a source of concern but added that the brewery giant is confident in its ability to weather the challenge due to the legacy it has built over 75 years.

“The deteriorating forex situation has led to foreign suppliers running out of patience with their Nigerian partners, mostly manufacturers who are finding it difficult to settle their rising foreign payables. Our outstanding foreign payables rose by 76 per cent in 2021 and due to lack of FX, the task of procuring input materials has been ardous and this hampered the completion of our capacity extension plan.

With the re-introduction of excise duty on non-alcoholic beverages and increase in excise duty rate for alcoholic beverages, these additional costs will lead to increase in the price of finished product. Volatility in the brewery sector is expected but we feel confident in our ability to grow and we have our pricing strategy as well as the cost and value agenda to maintain leadership in the market as well as sustain shareholders’ value and meet consumer demands in 2022”, Essaadi said.

Also speaking, the company’s Supply Chain Director, Martin Kochl, revealed that while NB Plc recognizes the importance of sustainable local sourcing of its agricultural raw materials and commercialization of local raw materials, the company is making conscious efforts to partner with local and international research institutes to improve the performance and adaptability of registered sorghum varieties

“We expect the tonnage to increase again and we are working with a whole of partners, research institutes to increase local sourcing and introduce higher yield sorghum varieties in the market and we are exploring other alternatives. We are expanding into growing sorghum in other areas as well and yes the supplies of sorghum has been ok but the prices of getting it has been rising”, Kochl said.