Guinness Nigeria Reports N20 Billion Profit Six Months After Tolaram Acquisition

Guinness Nigeria Plc has announced an impressive operating profit of N20 billion, just six months following its acquisition by Tolaram Group. The company’s second-quarter earnings report, covering the period ending December 31, 2024, indicates a pre-tax profit of N20.1 billion.

Tolaram acquired the Guinness Nigeria franchise in June 2024 from Diageo, marking a significant shift for the company.

This achievement represents a remarkable turnaround from the pre-tax loss of N8.2 billion recorded during the same quarter the previous year. Notably, this profit marks the first quarterly gain for Guinness Nigeria since it reported a profit of N3.8 billion for the first quarter ending September 2023.

Additionally, Guinness Nigeria Plc reported revenue of N259.6 billion for FY 2024, reflecting an impressive increase of 82.06% compared to FY 2023.

Domestic sales were the primary drivers of this growth, accounting for a substantial 98.5% of total revenue, while export sales contributed a modest 1.5%.

Despite the positive revenue figures, the company faced significant challenges due to rising costs. The cost of sales surged dramatically by 107.54%, escalating from N96.6 billion in FY 2023 to N200.5 billion in 2024. This increase in costs has raised concerns, as it outpaced revenue growth, prompting scrutiny over the company’s operational efficiency.

However, the company successfully increased its gross profit by 28.45% year-on-year, reaching N59 billion, up from N45.9 billion in FY 2023. This indicates that, despite soaring costs, Guinness Nigeria was able to maintain a healthy profit margin on its products.

Marketing and distribution expenses also saw a significant uptick, rising by 33.00% to N31.6 billion, compared to N23.7 billion in the prior year. This increase in expenses reflects the company’s commitment to enhancing its market presence and brand visibility amid a competitive landscape.

As a result of rising operational expenses, the company’s operating profit fell to N11.2 billion, down from N16.3 billion reported in FY 2023. This decline highlights the ongoing challenges that businesses in the sector face, particularly in managing costs while striving for growth.

In light of these developments, analysts are closely monitoring Guinness Nigeria’s strategies to navigate the rising cost environment and sustain its growth momentum in the coming fiscal year.

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