Guinness Nigeria Plc, in its full-year results for the period ending June 2023, revealed a staggering N49 billion exchange rate loss. As a result, the company declared a loss per share of N8.29 kobo, a significant contrast to the N7.15 earnings per share reported a year earlier.
Key highlights of the financial performance:
- Revenue for the year amounted to N229.2 billion, marking a 10.9% YoY increase.
- Gross profit reached N78.1 billion, reflecting a growth of 7.5% YoY.
- Operating profit declined by 2.3%, settling at N23.3 billion.
- Net finance cost surged to N45.4 billion, a staggering 20040.1% YoY increase.
- Loss after tax amounted to N18.1 billion, reflecting a significant decrease of 216.1%.
- Loans and advances stood at N63.7 billion compared to N31.3 billion YoY.
- Cash generated from operations improved to N57.3 billion from N38.9 billion YoY.
- Cash in the bank rose to N92.1 billion, showing growth from N69.1 billion.
Guinness Nigeria Plc declared a dividend of N15.6 billion, a significant increase from the N1 billion declared in the previous year. The Dividend Per Share (DPS) also rose sharply to N7.14 per share, marking a remarkable 1452% YoY increase.
Insights into the company’s financials:
The company attributed the loss of N18.1 billion to the forex depreciation, marking its first full-year loss since 2020 when the Covid-19 pandemic adversely impacted the financials.
Adjusting for the extraordinary forex loss of N49 billion, Guinness Nigeria reported an operating profit of N23.5 billion, indicating that without the forex charge, the company would have recorded strong profits.
Additionally, the company reported an unrealized exchange rate gain of N5.5 billion on foreign currency balances, which provided some cushioning against the exchange rate losses.
Guinness Nigeria Plc has a related party dollar loan of $22.5 million, with the naira equivalent now at N17.9 billion compared to N9.4 billion as of December 2022.
Moreover, the company has letters of credit related loans amounting to about $33.8 million, EUR 18.8 million, and GBP 2.9 million at the end of the year. Trade and other payables denominated in forex also amounted to $48.1 million, EUR 245, and GBP 5.5 million.
Despite the reported losses, Guinness Nigeria Plc still declared significant dividends, with the losses not immediately impacting cash balances. The company’s performance reflects the impact of exchange rate fluctuations and related financial positions on its overall profitability.
