Nigerian Breweries Wipes Out Accumulated Losses As H1 Profit Hits ₦156.3bn

MaTaZ ArIsInG
Dallas, Texas

• Nigerian Breweries grew profit before tax by 18 percent to ₦156.3 billion in the first half of 2026 as stronger revenue and lower finance costs lifted earnings.
• The brewer eliminated its interest-bearing debt and returned retained earnings to a positive balance, marking a major recovery in its financial position.
• Revenue rose to ₦803.7 billion, supported by stronger sales, improved margins and sustained demand for premium brands and malt products.

Nigerian Breweries Plc recorded an 18 percent increase in profit before tax to ₦156.3 billion in the first half of 2026, driven by stronger revenue, improved operating efficiency and significantly lower finance costs.

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The brewer’s unaudited financial statements showed profit before tax rose from ₦132.2 billion recorded in the corresponding period of 2025, while profit after tax increased by five per cent to ₦92.95 billion from ₦88.4 billion a year earlier.

The company also recorded a major balance sheet turnaround by eliminating all interest-bearing debt and restoring retained earnings to a positive position after previously reporting accumulated losses.

Revenue for the six-month period rose by 8.9 percent to ₦803.7 billion from ₦738.1 billion in the corresponding period of 2025.

Revenue growth boosts margins

Management attributed the improved performance to revenue management initiatives, sustained investment in key brands, stronger execution across the business, and continued growth in premium products and the malt category.

Gross profit increased by 14.1 percent to ₦354.9 billion from ₦311 billion, while gross profit margin improved to 44.1 percent from 42.1 percent a year earlier.

Operating profit also rose by 7.9 percent to ₦164 billion, although operating margin eased slightly as higher operating expenses moderated the impact of revenue growth.

Looking ahead, management said it would continue prioritising revenue optimisation, cost efficiency, disciplined execution and strong cash generation.

Lower finance costs lift earnings

While operating costs remained elevated, Nigerian Breweries benefited from a sharp reduction in finance costs following the elimination of borrowings.

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Raw materials and consumables remained the company’s largest expense at ₦340.9 billion, while advertising, distribution and employee benefit costs also increased during the period.

However, finance costs declined by about half to ₦10.2 billion from ₦20.5 billion, providing additional support for profitability.

The improvement enabled the company to deliver stronger earnings despite continued inflationary and operating cost pressures.

Balance sheet records major turnaround

The brewer recorded one of its strongest balance sheet improvements in recent years.

Nigerian Breweries moved from a net debt position of ₦74.3 billion in the first half of 2025 to a net cash position of ₦74.6 billion after completely eliminating loans and borrowings.

Retained earnings also returned to positive territory at ₦13.6 billion, compared with an accumulated deficit of ₦72.2 billion as of December 2025.

Shareholders’ equity increased to ₦645.9 billion from ₦560.2 billion, while total assets rose to ₦1.09 trillion, supported by stronger liquidity and improved working capital.

Shares ease despite stronger earnings

Nigerian Breweries shares closed at ₦75.00 on the Nigerian Exchange on Thursday, down 2.2 percent from the previous day’s close.

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Despite the decline, the stock has gained 3.45 percent over the past month. We expect stronger earnings, debt elimination, and positive retained earnings to reinforce investor confidence as management continues its recovery strategy.

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