The harsh economic impact of Covid-19 pandemic has dealt its blow on Nigerian Breweries Plc (NSE – NB). According to the Unaudited Condensed Interim Financial Statements for the six months ended 30th June, 2020 released by the company on Thursday, revenue dropped by 10.80% while profit after tax nosedived by 58.03% in the first half of the year.
NB recorded N151.810 billion revenue in H1 2020 lower than N170.191 billion it reported in the same period in 2019 with a Profit after tax of N5.589 billion down from N13.318 billion posted in 2019. The Basic Earnings per share stood at 66kobo in the period in review.
It’s cost of sales – N92.668 billion represented 61.04% of the revenue. Thus the company registered a gross profit of N59.141 with a gross profit margin of 38.84%.
Marketing and Distribution Expenses of N34.336 billion alone gulped 58.06% of the gross profit. Other expenses include administrative expenses – N10.093 billion, finance cost – N6.824 billion, income tax expense – N2.756 billion.
In the second Quarter of the year (April to June), revenue dropped by 21.01% to N68.651 billion from N86.913 billion in Q2 2019. Whereas profit after tax dipped by 98.42% to N83.913 million in Q2 2020 from N5.298 billion reported in Q2 2019.
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The total assets of NB rose considerably to N464.199 billion as at 30 June 2020, from N382,778 as at 31 December 2019. This is due to significant increases in the some assets components such as Right of Use Asset (ROUA) – rose to N28.793 billion from N11.074 billion in 2019, Trade and other receivables – rose to N32.858 billion from N21.307 billion in 2019, Cash and cash equivalent – rose to N57.103 from N6.361 billion as at 31 December 2019.
Consequently, the total liability of NB increased to N303.227 billion as at 30 June 2020 from N215.027 billion as at 31 December 2019. This is largely due to massive increase in “current” loans and borrowings to N112.737 billion from N16.826 billion in 2019.
The total equity of the company declined to N160.892 billion from N167.750 billion as at 31 December 2019 due to decrease in the retained earnings to N82.894 billion from N89.382 billion.
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NB cash flow remained strong as cash and cash equivalents as at 30th June 2020 amounted to N57.103 billion. The company registered a positive net cash flow of N9.491 billion from its operating activities, a net negative cash flow of minus N14.591 billion from its investing activities due to acquisition of property, plant and equipment worth over N14 billion.
The net cash flow from its financing activities was positive at N55.842 billion due to N130.863 billion recorded as proceeds from loans and borrowings although it spent N66.928 billion for Repayment of loans and borrowings in the period in review..
Nigerian Breweries is into the business of brewing and marketing of Lager Beer, Stout and Non-Alcoholic drinks. It is listed on the main board of NSE under the consumer goods sector.
The share price stood at N31.00 per at the close of trade on Wednesday and it has remained unchanged since 21 July 2020. YTD the share price is down by 47.46% while in two years and five years it is down by 81.90% and 76.99% respectively. The 52 week high and low prices N59.75 and N22.00 per share respectively.
Written by;
Ifunanya Ikueze
