Guinness Nigeria Delivers 161% YTD Gain, Returns to Profitability
Equity investors’ reaction to Guinness Nigeria’s earnings release was flattish, with the record showing the brewer company has delivered a 161% year-to-date return on investment this year.
This means that every N1 million investment in the brewer stock has turned to N2.61 million as Guinness Nigeria share price trades near a 52-week high in the Nigerian Exchange.
In its audited financial statement for 9 months of financial year 2025, Guinness Nigeria Plc reported a profit after tax of ₦6.7 billion, marking a significant recovery from the ₦61.6 billion loss posted in the prior year.
While the price remained flat, active trading volumes suggest that investors are repositioning in anticipation of continued recovery, PAC Capital Limited said in a note.
The brewer has delivered a 161.6% year-to-date return, and analysts at Afrinvest Securities Limited guided a sell in their stock recommendation at a reference share price of N183.75.
With a target price of N128.14, Afrinvest Securities Limited implies that the brewer company is currently overvalued, which attracts a sell rating on the share.
But Guinness Nigeria Plc rebounded, triggering cautious reactions from its shareholders, who were caught between ramping up, staying neutral or reducing their interest in the company.
The company’s unaudited results highlight strong operational and financial recovery. Analysts said the company has not only returned to profitability but also delivered significant top-line growth and balance sheet strengthening.
However, the sharp rise in operating expenses and the decline in other income are areas that may require strategic reassessment moving forward. Overall, the results suggest renewed investor confidence and a more stable outlook for the remainder of the financial year.
The company recorded a substantial increase in revenue, which grew by 71.56% year-on-year to ₦377.94 billion, up from ₦220.30 billion in the comparable period of 2024.
This remarkable revenue growth was attributed to improved sales volumes, pricing actions, improved portfolio mix, and strengthened consumer demand across key categories.
However, the company also faced a sharp rise in the cost of sales, up by 79.77% year-on-year to ₦274.41 billion, outpacing revenue growth. This reflects inflationary pressures, currency depreciation, and higher input costs, particularly in brewing and packaging.
Despite these pressures, gross profit grew by 53.02% year-on-year to ₦103.53 billion, indicating that the company was able to maintain a relatively strong margin, even amid cost pressures.
Operating profit increased by 32% year-on-year, moving from N22.2 billion to N29.2 billion, as the company reaped the benefits of cost optimisation, productivity enhancements, and efficient marketing investments.
Despite a high inflationary environment and FX-related pressures, net finance costs were managed effectively, contributing to a N6.7 billion net profit, PAC Capital Limited explained.
Analysts highlighted that Guinness Nigeria’s other income dropped considerably by 93.86% year-on-year to ₦188.30 million from ₦3.07 billion, suggesting fewer non-core income streams during the period.
The company’s operating expenses grew significantly, driven by marketing and distribution expenses surge of 43.86% year-on-year to ₦50.52 billion.
It was also fuelled by 80.87% surge in administrative expenses to ₦23.95 billion. Analysts said the high rise in these cost components implies an aggressive push in brand visibility, market expansion, or possibly cost inflation in logistics and personnel.
Guinness Nigeria’s finance income skyrocketed by 964.49% year-on-year to ₦80.26 billion, driven by gains on financial instruments, interest from short-term investments, or favourable foreign exchange positions.
Its finance expenses declined slightly by 5.45% year-on-year to ₦95.13 billion, resulting in a massive 82.08% reduction in net finance costs to ₦14.87 billion — significantly boosting overall profitability.
Guinness Nigeria posted a profit before tax of ₦14.39 billion, compared to a loss of ₦60.5 billion in the prior year. Despite a rise in tax expense from ₦1.20 billion to ₦7.66 billion, the company closed the period with a ₦6.72 billion net profit, reflecting a 110.91% year-on-year turnaround in profitability.
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