Nigerian Breweries Plc has announced that it will use the proceeds from its ongoing N599.1 billion Rights Issue to eliminate foreign exchange-related expenses and reduce bank borrowings.
At the “Fact Behind the Rights Issue” event on the Lagos floor of the Nigerian Exchange (NGX) Limited, Mr. Hans Essadi, Managing Director/CEO of Nigerian Breweries Plc, detailed that the funds from the 22,607,491,232 ordinary shares of 50 kobo each will be directed towards settling both foreign and local currency obligations. This move aims to eliminate foreign exchange risk and revaluation losses, thereby enhancing long-term profitability and sustainable value creation for shareholders.
Essadi further highlighted that despite a challenging external environment marked by high inflation and increasing operating costs, Nigerian Breweries has shown resilience and is on a recovery path, as evidenced by the results for the six months ending June 30, 2024. The company has consistently delivered value to customers and dividends to shareholders since its listing on the Exchange in 1973.
Ben Wessels Boer, Finance Director of Nigerian Breweries, reported a 34% increase in operating profit for the half-year period ended June 30, 2024. Revenue grew by 73% compared to the same period in 2023, driven by strategic pricing, innovation, volume growth, and market recovery. However, costs related to sales, distribution, and administration increased by 46% due to inflationary pressures and forex devaluation affecting imported materials. The company continues to invest in its brands and support market recovery.
Uaboi Agbebaku, Legal Director at Nigerian Breweries, stated that 22,607,491,232 ordinary shares of 50 kobo each are being offered to shareholders registered as of the Qualification Date, July 12, 2024.
Jude Chiemeka, CEO of NGX Limited, emphasized the significance of Nigerian Breweries, noting its market capitalization of N294 billion and its long-standing presence since 1946, with its listing on the Exchange in 1973. The NGX platform continues to support the company’s expansion and fundraising efforts.