Following the adverse impact of the sharp contraction in economic activities and the knock-on effect of the national lockdown occasioned by the Covid-19 pandemic, which has been taking a toll on the on-trade segment of its business across all our markets, Guinness Nigeria Plc has informed the public about the material circumstances that will impact its full-year financial results for 2020.
In a statement to the Nigerian Stock Exchange (NSE), Guinness Nigeria said that its production and revenues had been negatively affected. Guinness’ financing cost rose by 97 % to N3.582 billion compared to N1.817 billion recorded in 2019.
The statement reads: “Due to a combination of the impact of Covid-19 and the asset impairment, we expect the profitability of the company for the Financial Year to 30th June 2020 to be impacted. The company’s balance sheet, however, remains strong, and this gives the board the confidence that the company has the right resources to continue to deliver the strategy.”
Recall that Guinness Nigeria Plc reported revenue of N96.08 billion for the nine months that ended March 31, 2020, showing a fall of 5.3% compared with N101.40 billion recorded in the corresponding year of 2019.
In addition, financing cost rose by 97% to N3.582 billion compared to N1.817 billion recorded in 2019. Guinness Nigeria PLC ended the period with a profit after tax of N1.672 billion, plunging by 60% from N4.252 billion recorded in 2019.
The brewing giant, however, carried out a comprehensive review of its asset base and made a strategic decision to impair a certain category of assets, which were generating suboptimal returns, explaining that it was in line with the company’s long-term strategy of delivering value to shareholders.