Looming Job Losses as Nigerian Breweries Shuts Down Two Breweries Amid Record N153 Billion Loss
- Nigerian Breweries has announced a recovery plan after reporting a loss of about N153 billion in 2023
- The figure represents the highest foreign exchange loss in the company's history since it began operations in Nigeria
- Part of the strategy to recover includes the temporary closure of two of its nine breweries across Nigeria
Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology and the stock market.
Nigerian Breweries Plc has announced intentions to temporarily close two of its nine breweries nationwide.
This update came through a notification posted on the Nigerian Exchange Limited's website.
The beer company stated that this decision is a component of a comprehensive restructuring of its operations, prompted by various financial and operational challenges.
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NB Plc suffers biggest loss
Nigerian Breweries experienced its largest after-tax loss in its 77-year history in the country, largely due to a net loss of N153.3 billion from foreign exchange transactions.
The brewer stated that the losses were attributable to double-digit inflation rates, naira devaluation, FX challenges and diminished consumer spending.
Consequently, the company deems it imperative to reposition itself for a sustainable future that benefits stakeholders, necessitating tough decisions.
Among the measures being considered for operational efficiency, job cuts loom as a strong possibility.
Discussions about the potential implications of this move have already been initiated with the two unions involved.
The company has informed labour organizations, including the National Union of Food, Beverage and Tobacco Employees, as well as the Food Beverage and Tobacco Senior Staff Association, about the decision to temporarily suspend operations at the two plants.
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Closure to impact employees, consumers
Addressing these changes, Hans Essaadi, the managing director/CEO of Nigerian Breweries Plc, expressed the company's commitment to minimizing the impact on both employees and consumers.
He stated:
“We recognize and regret the impact that the suspension of brewery operations in the two affected locations may have on our employees.“We are committed to limiting the impact on people as far as possible and providing strong support and severance packages to all affected."We are also committed to supporting our host communities in ways that ensure they continue to feel our presence.”The focus will now turn to the remaining seven manufacturing plants to maximize their production capacity.
The company emphasized its dedication to positively impacting its host communities and consumers by leveraging its diverse portfolio of brands.
It would be recalled that Legit.ng earlier reported that Essaadi stated in an interview with Bloomberg that Nigerians were no longer able to buy beer due to the economic situation of the country.
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Nigerian Breweries announces price adjustments
In related news, Legit.ng reported that Nigerian Breweries Plc declared a price adjustment for all its products from August 10, 2023.
The company conveyed in a formal communication that this price revision was deemed essential due to the sustained escalation in input costs, necessitating measures to mitigate the resulting impact.
The decision directly results from the increasing expenses associated with raw materials, contributing to a complex financial landscape for businesses.
Source: Legit.ng
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