Champion Breweries Plc has returned to profitability as it recorded a profit after tax of N14.579 million for the half year ended June 30, 2015, from a loss position of N884.712 million recorded in the same period in 2014. In a filing with the Nigerian Stock Exchange (NSE), the company’s turnover grew from N1.399 billion in 2014 to N1.595 billion during the review period of 2015, accounting for growth of 14 per cent.
Champion had returned to profitability with a profit after tax of N13.400 million for the first quarter ended March 31, 2015, from a loss of N391.503 million in 2014. Also, the company’s turnover grew from N174.180 million in 2014 to N245.627 million during the review period of 2015, accounting for growth of 41 per cent. It posted a loss of N754.523 million for the financial year ended December 31, 2014.
The company had recorded a loss after tax of 754.523 million in 2014 from a loss position of N1.178 billion in 2013, accounting for a percentage change of 35.9 per cent. Likewise, the company posted a loss before tax of N1.071 billion in Q4 of 2014 from a loss position of N1.703 billion reported in the same period of 2013, representing 38.1 per cent. Gross earnings dropped to N3.302 billion during the review period as against N2.133 billion a year ago, accounting for a decrease of 47.9 per cent. The management of Champion Breweries had, in 2014, indicated that the company would soon overcome its challenge of capital inadequacies with planned recapitalisation exercise.
The recapitalisation, according to the management, would enable the company to maintain and sustain the production of premium quality beer and non-alcoholic beverages that meet international brewing standards through the deployment of cuttingedge technology and application of human capital.
The Raysun Nigeria Limited, a wholly owned subsidiary of Heineken International BV, became the new core investor in Champion Breweries following the sale of 513 million ordinary shares of 50 kobo each by Consolidated Breweries Plc, the previous core investor in Champion Breweries.
The shares were crossed to Raysun on the floor of the NSE. As a result, Raysun now owns a 57 per cent equity stake in the total issued share capital of Champion Breweries. Chairman, Consolidated Breweries Plc, Prof. Oyinade Odutola-Olurin, said that the sale of its equity stake in Champion Breweries was meant to provide the company with better financing opportunity.
She noted that Champion Breweries had recorded losses over the years and had relied on financing from Consolidated Breweries in form of inter-company debt. Consequently, she said that associated interest burden of the intercompany debts on Champion Breweries has negatively impacted its profitability.
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