- Board gets shareholders’ nod to raise N600bn
The financial situation of Nigerian Breweries Plc worsened in the first quarter of 2024 ended March 31, 2024, with net loss increasing by 391 percent to N52.09 billion.
In the first quarter of 2023, net loss stood at N10.72 billion.
The loss, according to Nigerian Breweries Plc is due to increased interest rates resulting from the upward adjustments in monetary policy rates and continued volatility in the foreign exchange market.
Meanwhile, revenue grew by 84 percent over last year driven by product innovation and pricing to partly mitigate the effects of increasing input cost, and on the back of a weak Quarter 1 in 2023 which was impacted by cash scarcity that followed the redesign of the naira notes.
“Our business demonstrated resilience and delivered strong operational performance in the first quarter of 2024 despite the sustained challenging business environment,” NB Plc said in a statement.
Results from operating activities grew by more than 1000 percent, underlying the strong topline performance and rigorous cost-saving initiatives in the period.
Looking forward, while the Nigerian business environment remains turbulent in the short term, “we maintain our unwavering belief in the country’s positive long-term market fundamentals. We are committed to navigating these challenges with the implementation of our business recovery plan, which is a business-wide reorganisation programme involving the optimisation of our operations for efficiency, and capital injection via a rights issue to improve our financial position,” NB stated.
However, shareholders of the foremost brewing have consented to the request of the Board of Directors to raise a fresh capital of N600 billion via Rights Issue to salvage its worsening financial situation.
At the Annual General Meeting held in Lagos last week, shareholders passed the following resolutions to raise the fund: “That subject to obtaining the approval of the relevant regulatory authorities, the Directors of the Company be and are hereby authorised to raise capital of up to ₦600 billion (six hundred billion naira) by way of Rights Issue, through the issuance of ordinary shares, on such other terms and conditions and at such time, as the Directors may deem fit or determine.
“That shares not taken up by existing shareholders within the period stipulated under the Rights Issue may be offered to shareholders of the Company that have indicated interest in purchasing additional shares not taken up by the shareholders entitled to do so in the Rights Issue, on such terms and conditions as may be determined by the Directors, subject to complying with relevant regulatory requirements.
“That the share capital of the Company be increased by the exact number of ordinary shares which would be required upon determination of the terms of the Rights Issue and the Directors are hereby authorised to pass resolutions for such increase, as well as to allot the new ordinary shares upon completion of the Rights Issue.”
