NB Takes Early Bet on Recycle PET Ahead of Regulation
In a move that may have slipped beneath the radar of many market observers, Nigerian Breweries has taken a calculated step that reflects both regulatory foresight and long-term supply chain strategy.
With a market value of N2.4 trillion, Nigerian Breweries Plc returned to profitability in the financial year 2025, reversing negative performance in the prior year driven by higher product pricing.
The brewer recently entered into a strategic partnership to establish a food-grade recycled Polyethylene Terephthalate (rPET) production facility in Ogun State, securing a 29% equity stake in the project.
The facility will be developed and operated by Indorama Ventures Recycling Solutions Limited, a subsidiary of Indorama Ventures, widely regarded as the world’s largest PET recycler.
Under the arrangement, Nigerian Breweries will hold a minority interest and maintain limited involvement in the operational control or management of the business. However, the strategic value of the investment lies less in governance and more in future supply assurance.
Nigeria is gradually moving toward mandatory incorporation of recycled PET in packaging, a policy direction outlined in the country’s plastic waste strategy. By investing early in domestic recycling capacity, Nigerian Breweries is effectively locking in access to a critical raw material before regulatory demand fully materialises.
From a financial market perspective, the strategy reflects a low-risk, high-optionality approach. Rather than waiting for policy enforcement to tighten supply chains, the company is positioning itself upstream, securing future feedstock while supporting the development of the local recycling ecosystem.
Beyond regulatory preparedness, the partnership could evolve into a meaningful value lever over time. Access to locally produced food-grade rPET may reduce exposure to imported materials, enhance cost predictability, and strengthen supply chain resilience for Nigerian Breweries’ packaging operations.
At the same time, the investment aligns with the company’s sustainability agenda, supporting circular economy initiatives and contributing to the growth of Nigeria’s recycling industry.
While such developments rarely trigger immediate market excitement, they often reveal the strategic discipline of companies that outperform over the long term. On the Nigerian Exchange Limited, the winners are not always the most visible operators, but those quietly making forward-looking decisions while the market’s attention lies elsewhere.
For Nigerian Breweries, this minority stake in a recycling facility may appear modest today. Yet as regulatory momentum builds around recycled packaging materials, the investment could prove a forward-looking supply hedge and a new revenue stream in the years ahead.
In 2025, Nigerian Breweries recorded a 35.3% year-on-year increase in revenue, settling at ₦1.47 trillion, up from ₦1.08 trillion in FY 2024.
This performance was largely driven by sustained price increases across key product segments and continued innovation within its premium portfolio, which helped protect margins.
The company’s cost of sales, adjusted for depreciation, grew more slowly than revenue, rising 16.8% y/y to ₦849.16 billion from ₦727.06 billion in FY 2024.
#Overall, the company reported a Pre-tax Profit of ₦161.06 billion, a marked turnaround from the Pre-tax Loss of ₦182.91 billion recorded in FY 2024.
After accounting for a tax expense of ₦61.96 billion, NB Plc delivered ₦99.10 billion as net income, compared with a Loss After Tax of ₦144.99 billion in the previous year.
Cadbury Nigeria Short-term Momentum Masks Investors’ Reality
