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Nigerian Breweries Announces Plan to Raise N600bn



Nigerian Breweries Plc has disclosed its intention to raise up to N600bn through a Rights Issue.

A corporate notice was submitted to the Nigerian Exchange Limited, signed by Uaboi G. Agbebaku, the Company Secretary. The decision to raise capital was reached at a recent Board of Directors meeting.

A section of the notice stated, “The board has agreed to propose to shareholders, at the upcoming Annual General Meeting, the plan to raise up to N600bn through a Rights Issue, pending regulatory approvals.

“Given the adverse effects of the naira devaluation and high borrowing costs on the company’s financial structure, particularly its debts, the proceeds from the Rights Issue will aid in alleviating the substantial debt burden, resulting in a more robust balance sheet.

“Alongside cost-cutting measures and operational efficiencies, the board remains hopeful about guiding the company towards sustainable profitability in the near future.”

Additionally, the board seeks to secure shareholders’ approval, at the forthcoming AGM later this month, for an increase in the company’s share capital to accommodate the new shares issued under the Rights Issue.

In its audited financial results for the year ending December 2023, Nigerian Breweries Plc reported a foreign exchange loss of N153bn attributed to the naira devaluation.

During the period, revenue grew by 8.9% to N599.64bn from N550.64bn. However, net finance expenses surged by 449.7% to N189.19bn, leading to a loss of N106.31bn for the company, compared to a gain of N13.19bn in 2022.

Citing challenging macroeconomic conditions, the Board of Directors of NB expressed readiness to leverage its extensive Nigerian operating experience to navigate the present economic challenges.

“In a demanding business landscape, the Board is committed to leveraging over 77 years of operational history in Nigeria to confront current realities.

“The company will persist in being adaptable and forward-looking, utilizing its diverse portfolio, robust supply chain network, and dedicated workforce to drive sustainable value creation for shareholders and stakeholders,” the board highlighted.