CHAMPION BREWERIES PLANS PUBLIC SHARE OFFER AMID PROFIT DECLINE
Key Details:
1. Public Offering Announcement: Champion Breweries has revealed plans to open a public share offering to raise funds for its operations. This decision was shared during its "Fact Behind the Figures" presentation at the Nigerian Exchange (NGX) on Tuesday.
2. New Shareholder Initiative: The move is driven by its new core shareholder, EnjoyCorp, aiming to strengthen the company's market position. EnjoyCorp is seeking to expand and solidify operations by injecting more funds into the business.
3. Financial Performance:
Revenue Growth: The company recorded a revenue of N12.7 billion in 2023, a 3% increase from the N12.29 billion reported in 2022.
Profit Decline: Despite this revenue growth, Champion Breweries' net profit dropped significantly by 74% from N1.41 billion in 2022 to N370 million in 2023.
Profit Margins: The net profit margin also fell from 11% to 3% year-on-year. Despite this decline, Champion Breweries outperformed many of its peers, who recorded losses during the same period.
4. Regional Operations: The brewery's operations are largely regional, focusing on Akwa Ibom, Imo, Enugu, and Cross River States. However, it continues to strengthen its presence across the region.
5. Profitability Strategy: Champion Breweries' profitability in 2023 was attributed to strategic raw materials hedging, specifically for sorghum, its primary input. By securing a supply early in the year, the company was able to mitigate price instability.
6. Efficiency Metrics: Champion Breweries boasted a return-on-equity (ROE) of 3% for FY 2023, outperforming competitors who posted negative ROEs.
The company's management remains optimistic about its future, with the upcoming public offering seen as a key step in sustaining its operations and expanding its market reach.
Key Details:
1. Public Offering Announcement: Champion Breweries has revealed plans to open a public share offering to raise funds for its operations. This decision was shared during its "Fact Behind the Figures" presentation at the Nigerian Exchange (NGX) on Tuesday.
2. New Shareholder Initiative: The move is driven by its new core shareholder, EnjoyCorp, aiming to strengthen the company's market position. EnjoyCorp is seeking to expand and solidify operations by injecting more funds into the business.
3. Financial Performance:
Revenue Growth: The company recorded a revenue of N12.7 billion in 2023, a 3% increase from the N12.29 billion reported in 2022.
Profit Decline: Despite this revenue growth, Champion Breweries' net profit dropped significantly by 74% from N1.41 billion in 2022 to N370 million in 2023.
Profit Margins: The net profit margin also fell from 11% to 3% year-on-year. Despite this decline, Champion Breweries outperformed many of its peers, who recorded losses during the same period.
4. Regional Operations: The brewery's operations are largely regional, focusing on Akwa Ibom, Imo, Enugu, and Cross River States. However, it continues to strengthen its presence across the region.
5. Profitability Strategy: Champion Breweries' profitability in 2023 was attributed to strategic raw materials hedging, specifically for sorghum, its primary input. By securing a supply early in the year, the company was able to mitigate price instability.
6. Efficiency Metrics: Champion Breweries boasted a return-on-equity (ROE) of 3% for FY 2023, outperforming competitors who posted negative ROEs.
The company's management remains optimistic about its future, with the upcoming public offering seen as a key step in sustaining its operations and expanding its market reach.