International Breweries Plc has recorded its seventh consecutive after-tax loss despite achieving strong revenue growth in the 2024 financial year as foreign exchange volatility and rising input costs continue to weigh heavily on the company’s bottom line.
According to its audited annual financial statement, the brewer reported a net loss of N113.6 billion for the year ended 31 December 2024, representing a 62.5 percent increase from the N70 billion loss recorded in 2023.
The sustained losses have been primarily attributed to massive foreign exchange losses triggered by the naira devaluation and Nigeria’s unified exchange rate policy.
The Osun-based beer manufacturer posted a rise in revenue from N260.5 billion in 2023 to N488.9 billion in 202, its highest earnings in nine years.
However, the gains were eroded by substantial FX-related losses and higher production costs.
“While continually delivering strong revenue growth our inability to source adequate foreign exchange due to market illiquidity impacts profitability as we incurred significant FX losses on our foreign currency-denominated debt and liabilities” the company said in its financial disclosure.
The report shows unrealised foreign exchange losses for the year stood at N128.4 billion while realised losses surged to N294.1 billion compared to N14.3 billion in the previous year.
This development reflects the company’s exposure to dollar-denominated loans used in previous years to fund operations and capital projects.
The firm, which has operated in a challenging macroeconomic environment, has also faced elevated raw material costs.
The cost of sourcing key brewing inputs such as barley and hops, which are mostly imported increased from N25.6 billion in 2023 to N58.14 billion in 2024, more than doubling year-on-year.
Since first slipping into losses in 2018, when it reported N3.87 billion in after-tax deficit, the company’s financial challenges have escalated.
In 2019, it recorded a loss of N27.79 billion, which contracted to N16.08 billion in 2020 before rising again to N17.66 billion in 2021 and N21.63 billion in 2022.
To address its financial pressures, International Breweries completed a rights issue programme in May 2024, raising fresh capital to repay outstanding foreign currency loans. The company disclosed that it had successfully settled its $379.9 million loan with support from its parent company Anheuser-Busch InBev.
Chairman of the Board Obi Achebe said the repayment of the forex-denominated liability marked a significant milestone for the company’s recovery path.
“This recapitalisation not only strengthens our balance sheet but also sets the stage for long-term profitability and growth” he stated.
The brewer noted that the removal of its FX exposure is expected to improve cash flow and aid its return to profitability in 2025 provided there are no major external currency shocks.
Anheuser-Busch InBev participated fully in the rights issue, underscoring its continued commitment to the Nigerian market and confidence in the company’s turnaround strategy.
With its loan burden eased and revenue base expanding, International Breweries is now focused on enhancing operational efficiency, boosting innovation and capturing emerging market opportunities in Nigeria’s competitive beverage sector.
As the firm looks to stabilise its financial performance management says the priority will be on cost control raw material localisation and risk mitigation against macroeconomic shocks to safeguard future earnings.
