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Amidst Covid-19 Crisis Coca-Cola Nigeria Unit Triples E-commerce sales

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Coca-Cola Co.’s Nigeria unit said it has seen a threefold increase in e-commerce sales this year after virus-induced lockdowns inspired a change in consumer habits in Africa’s most populous country.

The US beverage giant saw a sharp rise in online sales of its products after Africa’s largest economy joined the global trend of imposing movement restrictions on people to contain the spread of the virus, according to its chief executive officer.

“The first one month of Covid-19 was the pivot point,” for e-commerce penetration in the company, CEO Alfred Olajide said at an interview in Lagos, Nigeria’s commercial hub. “We have more than tripled the e-commerce business that we have in our portfolio,” he said without sharing details as the company isn’t listed in Nigeria.

According to a Bloomberg report, Nigeria is seen as a frontier for growth in e-commerce due to a largely youthful population with an average age of 18 and increased data penetration. The use of smartphones is poised to rise almost fourfold to 140 million by 2025, according to Statista.com, adding to the number of people going online to buy everything from groceries to garments.

The maker of Fanta and Sprite carbonated drinks and Eva water is partnering with online shopping firms including Jumia Technologies AG, a Berlin-based e-commerce platform that provides services in Lagos to push its products in the country, according to Olajide.

“Right now e-commerce orders as a proportion of sales are still in the single-digit but the ambition for us is to scale it to double-digit and make it a very big significant channel of choice for our consumers,” the CEO said without giving a timeline. “We are partnering to help the trend grow and you will see more of that coming through in our strategy.”

While high inflation rate and unemployment have eroded disposable income, the company is starting to see sales return in 2021 and probably match the pre-covid period as the economy improves, Olajide said.

Coca-Cola has adjusted prices and has “smaller, more value-based pack sizes to cater for consumers that have low disposable income,” the CEO said. That has helped sales recover this year after they took a knock in 2020, as the country experienced its worst economic contraction since at least 1991 due to measures to contain Covid-19.

The foreign exchange shortage hampering industries in Africa’s biggest crude producer has not impacted operations as it gets most of its inputs locally including plastics, crowns, labels and sugar, Olajide said. Concentrates imports are not that huge to cause a disruption to the business, he said.

“What we do as an organization is to look for ways to continue to be more efficient,” Olajide said. “There is a lot recovery happening in the business and I will peg it to the fact that the country itself is improving.”

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Guinness Nigeria Postpones Spirits Importation Exit, Extends Deal with Diageo

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Guinness Nigeria Plc has announced a delay in its plan to halt the importation of spirits as it extended its agreement with multinational alcoholic beverage company Diageo until 2025.

The decision, communicated through a corporate notice filed with the Nigerian Exchange Limited on Tuesday, cited a longer-than-expected transition period for separating its business from Diageo’s.

Initially slated for discontinuation in April 2024, the importation of premium spirits like Johnnie Walker, Singleton, Baileys, and others under the 2016 sale and distribution agreement with Diageo will now continue for an additional year.

The extension comes as the process of business separation between Guinness Nigeria, a subsidiary of Diageo, and Diageo itself faces unexpected delays.

In October, Guinness Nigeria had announced plans to cease importing spirits from Diageo, a move aimed at reducing its foreign exchange requirements.

However, the separation process has encountered unforeseen hurdles, necessitating the extension of the importation agreement.

The notice, signed by the company’s Legal Director/Company Secretary, Abidemi Ademola, highlighted the ongoing efforts by Guinness Nigeria and Diageo to implement the separation, originally scheduled for completion by April 2024.

The extension underscores the complexity of disentangling the businesses and ensuring a smooth transition.

Guinness Nigeria reaffirmed its commitment to the long-term growth strategy, aligning with Diageo’s decision to establish a new, wholly-owned spirits-focused business.

Despite the delay, both companies remain dedicated to managing the importation and distribution of international premium spirits in West and Central Africa, with Nigeria as a key hub.

The postponement comes amid challenges faced by Guinness Nigeria, including significant exchange rate losses, which amounted to N49 billion in the 2023 half-year operations.

Despite these setbacks, the company remains optimistic about its future prospects in the Nigerian market.

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Apple’s Market Value Plummets Amid Regulatory Scrutiny on Both Sides of Atlantic

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Apple Inc. finds itself at the center of regulatory storms on both sides of the Atlantic, leading to a significant dip in its market value.

The tech giant is facing intense scrutiny from regulators with allegations of antitrust violations looming large.

In the United States, the Department of Justice, along with 16 state attorneys general, has filed a lawsuit against Apple, accusing the company of breaching antitrust laws.

This legal action has sent shockwaves through the investment community, resulting in a 4.1% drop in Apple’s shares on Thursday alone.

This decline wiped out approximately $113 billion in market value, increasing its year-to-date losses to 11%.

Once hailed as the world’s most valuable firm, Apple’s shares have underperformed major indices like the Nasdaq 100 and the S&P 500 in 2024.

Across the pond, European regulators are also eyeing Apple’s practices closely. The company faces potential probes into its compliance with the region’s Digital Markets Act.

This legislation empowers authorities to levy hefty fines, up to 10% of a company’s total annual worldwide revenue, for violations.

With investigations looming, Apple’s future in the European market appears uncertain.

Despite Apple’s staunch defense against the allegations, investors remain jittery about the implications of regulatory actions.

The company’s legal battles have underscored broader concerns about its dominance in the digital marketplace and the impact on competition.

As the regulatory saga unfolds, Apple must navigate turbulent waters, balancing legal challenges with its commitment to innovation and market leadership.

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NNPC Gears Up for Public Listing, Embraces Full Commercialization

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The Nigerian National Petroleum Company Limited (NNPC) is poised for a transformation as it sets its sights on a public listing.

The announcement came from Mele Kyari, the Group Chief Executive Officer of NNPC, during his address at the ongoing 2024 CERAWEEK in Houston, United States.

Kyari affirmed NNPC’s commitment to aligning with the provisions of the Petroleum Industry Act (PIA), which mandates the company to become a quoted entity.

This move, he emphasized, is a pivotal step towards realizing the objectives outlined in the PIA, ensuring transparency, efficiency, and profitability in the Nigerian oil and gas sector.

In his remarks, Kyari highlighted the transformative journey NNPC has undergone, transitioning from a government-owned corporation to a commercially-oriented and profit-driven entity.

He emphasized that the company has evolved into a full limited liability company, capable of generating dividends for its shareholders while adhering to tax and royalty obligations.

Furthermore, Kyari underscored the strategic importance of NNPC to Nigeria’s resource management and economic development, emphasizing its pivotal role in the country’s energy sector.

The planned public listing of NNPC shares is anticipated to democratize ownership and enhance transparency within the company’s operations.

Kyari noted that the process is in line with the legal framework established by the PIA and is expected to commence within the stipulated timeline.

NNPC’s bold move towards commercialization signifies a paradigm shift in Nigeria’s oil and gas industry, promising increased accountability, efficiency, and value creation for stakeholders.

As the company embraces this new era, it aims to consolidate its position as a key player in the global energy landscape while driving sustainable growth and development domestically.

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