Despite the economic headwinds imposed by the COVID-19 pandemic, the business outlook for Guinness Nigeria Plc, a subsidiary of Diageo Plc, in its audited results for the period ended June 30, 2021 revealed gross revenue growth of over N60 billion compared to N104 billion in the preceding year, just as it recorded a 110 per cent increase in profit after tax, with double digit revenue growth across all key categories despite the impact of COVID-19 restrictions and ongoing economic challenges.
Operating profit increased by 177 per cent benefitting from lapping significant impairments in the prior year and reduced administrative expenses arising from productivity savings.
Commenting on the results, Managing Director, Guinness Nigeria Plc, Mr. Baker Magunda said the performance of fiscal 2021 showed that the business delivered growth despite the challenging external environment characterised by COVID-19 restrictions and high inflation.
“This was supported by improved product mix and headline price increases in key brands. Gross margins declined by 3% driven by inflationary pressure, a shift towards more expensive can products given at-home consumption trends, and forex devaluation impacting some materials,” Magunda said.
The company however revealed that its net finance costs remained on similar level as last year despite the lower debt position, due to the devaluation of Naira impacting the foreign currency denominated trading balances.
“Tax was impacted by a one-off historic charge. Profit before tax increased to N5.8 billion, a 134 per cent growth versus same period last year; and distribution expenses increased by 22 per cent versus last year behind volume growth due to efficiency improvements across distribution channels.
“Going into the new fiscal year, we are conscious of the continued challenging operating environment with double-digit inflation and pressured consumer income spending. However, we will continue to focus on our strategy – optimising our route to consumer, innovating at scale to satisfy our consumers and improving cost control – as we continue to emerge stronger from the current crisis. We remain confident about the execution and resilience of our Total Beverage Alcohol strategy as a key driver of sustainable growth in the market,” Magunda said.
Chairman, Guinness Nigeria Plc, Dr. Omobola Johnson assured that the board will continue to support management in its efforts to sustain global best practices aimed at consistently delivering business growth for stakeholders.
“We remain confident that the strategy is comprehensive and robust, and that we are making the right investments in the company to ensure our long-term competitiveness,” Johnson said.
Credit: thenationonlineng.net
