2020 Corporate Rating Report - International Breweries Plc.
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
International Breweries Plc. 2020 Corporate Rating Report
2020 Corporate Rating Report
International Breweries Plc
Issuer Rating
Bbb+ This refers to a company with satisfactory financial condition and adequate capacity to
meet obligations as and when they fall due.
Outlook: Stable
Issue Date: 4 March 2021
RATING RATIONALE
Expiry Date: 30 June 2021 Agusto & Co. assigns a “Bbb+” rating to International Breweries Plc
(“International Breweries”, “INTERBREW”, “IBPLC” or “the Company”). The
rating reflects the Company’s satisfactory levels of cash flow and working
Previous Rating: N/A
capital, the progress made towards deleveraging its balance sheet as well
as its strong position within the Brewery Industry in Nigeria. Also, the rating
Industry: Brewery represents an upward notching of the standalone rating of IBPLC on the
basis of the strong parental support from Anheuser-Busch InBev (“AB InBev
Group” or “the Group”), which we have considered as a credit enhancement
Outline Page
given the strength of AB InBev’s investment-grade ratings from three
Rationale 1
Overview of the Brewery 4 international rating agencies1. However, the assigned rating is constrained
Industry in Nigeria by IBPLC’s weak profitability evidenced by persistent losses over the last
Company Profile 7
Financial Condition 10 three years, which have continued to erode its long term funding capacity.
Ownership, Mgt & Staff 16 This is in addition to the likelihood of volume growth being impaired in 2021
Outlook 18
due to drawbacks on consumer spending power amid harsh realities of the
Financial Summary 19
Rating Definition 23 COVID-19 pandemic as well as the continuing restrictions on social life.
International Breweries Plc. is one of the leading brewers in Nigeria. The
Analysts: Company, which has found a niche in the midstream segment based on its
Christian Obiezu affordable brews, is gradually becoming a major contender in the premium
christianobiezu@agusto.com beer and stout segments with the launch of Budweiser and Trophy Stout
brands. The Company currently has four brewery plants strategically located
Isaac Babatunde
in Nigeria, with a combined installed production capacity of circa 9 million
isaacbabatunde@agusto.com
hectolitres per annum. IBPLC has an extensive product portfolio that caters
Agusto & Co. Limited to diverse consumer segments and wide networks of retail and wholesale
UBA House (5th Floor) distributors spread across the country.
57, Marina
Lagos IBPLC is a member of AB InBev – the world’s largest brewer and remains a
Nigeria strategic business unit for the latter’s dominance on the African market. The
Company enjoys strong technical, administrative and financial support from
www.agusto.com
AB InBev Group demonstrated through the continued credit lines provided
to the Company and the Group’s decision to take up its rights in the just
concluded capital raise. Post-rights issue, AB InBev’s combined shareholding
1
Moody’s (Baa1 rating, stable outlook), Fitch (BBB rating, stable outlook) and S&P (BBB+ rating, negative outlook). These ratings were issued in
March 2020.
The copyright of this document is reserved by Agusto & Co. Limited. No matter contained herein may be reproduced, duplicated or copied by any means whatsoever
without the prior written consent of Agusto & Co. Limited. Action will be taken against companies or individuals who ignore this warning. The information contained
in this document has been obtained from published financial statements and other sources which we consider to be reliable but do not guarantee as such. The
opinions expressed in this document do not represent investment or other advice and should therefore not be construed as such. The circulation of this document is
restricted to whom it has been addressed. Any unauthorized disclosure or use of the information contained herein is prohibited.International Breweries Plc.
has increased to 87.29% from 75.03% as at year-end 2019. With the new
opportunities presented by the African Continental Free Trade Area
(AfCFTA), Agusto & Co. expects a sustained parental backing in a bid to grow
the Company’s market share in the breweries industry in Nigeria as well as
enhance AB InBev dominance on the African frontier.
In recent times, the competitive landscape in the domestic beer market has
become stiffer with destructive price war, increase in excise duties and rising
operating and finance costs all constraining operators’ revenue and profit.
Despite the challenging business environment, International Breweries Plc’s
net revenue increased by 9.7% to ₦132.3 billion to reflect the higher
volumes sales supported in part by the launch of its premium brand
(Budweiser). In the same period, the Company’s cost of sales and operating
expenses rose sharply to 81% and 31.8% respectively (2018: 70.1%, 21.3%),
thus resulting in an operating loss of ₦16.9 billion. IBPLC’s loss for the year
was further magnified by its the huge interest burden, while its other
profitability indicators such as return on assets and return on equity were
both in the negative territory. Overall, we consider the Company’s
profitability to be weak.
International Breweries posted an operating cash flow (OCF) of ₦55.5 billion
in 2019, which was an improvement from the deficit recorded in the
previous year, on the back of significant increase in trade creditors and
amounts due to related parties during the period. This OCF level, which
represented 42% of revenue, depicts a good cash generating capacity.
IBPLC’s three year (2017 – 2019) cumulative OCF as a percentage of returns
to providers of finance (which wholly comprised interest payment) of 355%
further reinforces our opinion on the Company’s good cash flow position.
As at FYE 2019, International Breweries Plc recorded an overall working
capital surplus of ₦31.8 billion, thus signifying a good funding capacity
based on its favourable trade terms with customers, suppliers and related
parties. We expect the additional equity funding buffer from the recent
rights issue to continue to support IBPLC’s adequate working capital.
Following the rights issue and the eventual deleveraging of its balance
sheet, the Company’s interest-bearing liabilities (IBL) fell by 59% to ₦107.3
billion as at 30 September 2020 (Q3’2020), while its interest expense to
revenue ratio plummeted to 3.3% (FYE 2019: 11.5%). Furthermore, IBPLC’s
net debt to total assets and IBL to equity ratios of 52% and 40% respectively
as at Q3’2020 (FYE 2019: 104%, 3,106%) underlined its improving leverage
position.
Although top line performance in Q3’2020 showed some resilience to
COVID-19 shocks, the Company still posted an operating loss of ₦10.5
billion. Management expects a reversal in the Company’s fortune driven by
2 2020 Corporate Rating ReportInternational Breweries Plc.
its resolve to aggressively expand product portfolio and distribution
channels leveraging its strong brand acceptance. Also, the Company intends
to protect margins across its product segments with another increase in
prices in 2021. This is in addition to implementing stringent cost
optimization and operational efficiencies across the business.
Going forward, we reckon that IBPLC’s ability to recover from the loss
making position is dependent on improvement in the competitive and
regulatory environments, which have continued to stymie growth within the
domestic brewery industry. However, we remain positive that favourable
market conditions such as the country’s large and growing drinking age
population and low per capita consumption of alcohol offer sufficient
headroom for beer volume growth in the medium term as consumers’
income levels improve (as the economy recovers) and the health concern
over large social gatherings minimised considerably with COVID-19
vaccination.
Based on the above, we attach a stable outlook to International Breweries
Plc.
Figure 1: Strengths, Weaknesses, Opportunities and Threats
Strengths
•Strong parental support from AB InBev Group
•Diversified and innovative product offerings
•Strong player in the lager segment
•Good cash flow
•Experienced and qualified management team
Weaknesses
•Weak profitability evidenced by persistent operating losses
•Extremely low margins across its product portfolio owing to its competition-
based pricing strategy
Opportunities
•Nigeria's large and growing drinking age population
•Low per capita consumption of alcohol
•Growth potentials in the premium and stout segments
Threats
•Intense price war among brewers, particularly in the beer segment
•Devaluation of the local currency and restrictive forex regime that could lead
to upsurge in costs
•Weakening consumer purchasing power amid negative macroeconomic
headwinds
•Unfavourable fiscal policies
•Decrepit national infrastructure - shortage of power supply and poor road
network
•Prolonged shut down of economic activities due to Covid-19 pandemic and
attendant impact on output
3 2020 Corporate Rating ReportInternational Breweries Plc.
OVERVIEW OF THE BREWERY INDUSTRY IN NIGERIA
Nigeria’s beer market is the second largest in Africa, though it remains well behind top-ranked South Africa in
terms of scale. The Industry, which is driven largely by the country’s large number of drinking age consumers,
has evolved from a duopoly to an oligopoly with multinational brewing giants competing for market share in
the country. The Brewery Industry is essentially controlled by three operators - Nigerian Breweries Plc (a
subsidiary of Heineken N.V. Group), Guinness Nigeria Plc (a subsidiary of Diageo) and more recently Anheuser-
Busch In Bev (AB InBev) operating through international Breweries Plc. These brewers produce both
internationally recognised premium brands and value brands specifically for the domestic and regional
markets. Domestically produced beers are made using locally sourced ingredients such as maize, sorghum and
cassava as well as imported components.
The geographical distribution of industry players across Nigeria shows that the South West region accounts
for the bulk of brewing plants in the country, with Lagos and Ogun States having the highest concentration,
estimated at 75%2. Lagos remains the largest beer market in Nigeria given its size, structure and status as the
country’s commercial and economic capital. There is only one brewing plant in the northern (Kaduna State)
part of the country owing to the region’s conservative religious and cultural differences. The remaining plants
are split between states in the South East and South-South region.
The entrance into the fray by the world’s leading brewer - AB InBev (through its acquisition of SABMiller) has
significantly altered the Brewery Industry’s competitive landscape in Nigeria. AB InBev backed International
Breweries Plc, which gained market recognition through its activities in the value segment, has now refocused
its strategy with the launch of Budweiser - a premium equivalent of Nigerian Breweries Plc’s Heineken brand.
Nigerian Breweries Plc still dominates the domestic beer market in terms of scale and revenue controlling
about 58% share. Since its incursion in the value and premium segments, International Breweries Plc’s market
share has risen steadily to emerge as the second player in the domestic beer market with about 33% share.
Conversely, Guinness’ strategic focus on its spirit segment has seen it drop to third position after ceding some
of its market share in the lager and stout segments to the other two players.
However, the Nigerian beer industry’s performance has been muted for the last few years on account of the
country’s sluggish economic growth, which has had an adverse effect on consumers’ discretionary spend, as
well as the regulatory headwinds of higher excise tax imposed on alcoholic beverage. As a result, there has
been a drastic shift in product pricing regime as well as the redesigning of product packaging to match
consumers’ income levels as the struggle for market share intensified. The destructive beer war has seen key
players suffer declining bottom lines as operators continue to absorb tariff and other incremental costs in a
bid to avoid significant drop in consumption volumes given consumers’ sensitivity to changes in product prices.
This is evidenced by recent decision by brewery giant - Nigerian Breweries Plc to reverse the increase in crate
prices on its premium lager brand – Heineken and stout brand – Legend, which took effect in the last quarter
of 2019, in order to protect its brands and market position. With the next round of the graduated increase in
excise duties already implemented, we expect the pressure on top line growth to ease but believe that the
intense competitive landscape and rising operating costs will continue to threaten the industry’s profitability.
2
Agusto & Co. Research
4 2020 Corporate Rating ReportInternational Breweries Plc.
Table 1: New Excise Duty Regime on Alcoholic Beverages
Product Type 2018 2019 2020
Beer & Stout
New Specific Rates ₦0.30 per cl ₦0.35 per cl ₦0.35 per cl
Previous ad-valorem Rate -20% - - -
Spirits
New Specific Rates ₦1.50 per cl ₦1.75 per cl ₦2.00 per cl
Previous ad-valorem Rate – 20% - - -
Wines
New Specific Rates ₦1.25 per cl ₦1.50 per cl ₦1.50 per cl
Previous ad-valorem Rate – 20% - - -
Other Alcoholic Beverages
New Specific Rates ₦1.50 per cl ₦1.75 per cl ₦2.00 per cl
Previous ad-valorem Rate – 20% - - -
Source: Agusto & Co. Research
There has been a steady shift in consumption pattern in the alcohol market given the increased patronage for
cheaper value brands and other home-brewed beverages. The switch to affordable brands is being driven by
Nigeria’s weak macroeconomic condition, which has negatively impacted consumers’ purchasing power.
Notwithstanding, premium brands growth remain resilient as operators continue to benefit from various
sponsorship and promotional deals, particularly in football 3. However, demand remains concentrated in the
value brand segment, with bulk weekend sales by bars, pubs, restaurants and other retail outlets across the
country.
With the country’s annual beer consumption estimated at 16 million hectolitres 4 and a per capita beer
consumption of less than 12 litres compared to global average of 35 – 40 litres5, Nigeria remains an attractive
proposition for foreign investments6 notwithstanding daunting macroeconomic challenges and growing
competition from illicit brews. Buoyed by the positive implications of the new minimum wage on consumers’
discretionary spend, there was high optimism for the brewery industry going into 2020. However, the increase
in Value Added Tax (VAT) rate, land border closure (which led to renewed inflationary pressures) and the
unprecedented disruptions to beer production, distribution and consumption amid the global outbreak of the
novel Coronavirus (COVID-19), have reshaped the Industry’s outlook for the future.
The overall impact of the COVID-19 pandemic on the beverage alcohol industry has been overwhelming since
Mid-March of 2020. From on premise shutdowns to supply chain challenges, the beer market in Nigeria, like
most countries around the world, faced significant disruptions during the peak of the pandemic. At-home beer
consumption (off-premise) remains elevated throughout 2020 as concern regarding health, safety and public
gathering continue to shape consumption patterns and channels, although we noticed significant spikes in on-
site volumes in the last quarter of 2020 (particularly during the yuletide).
3
Heineken, the parent company of NB, is renowned for its sponsorship of the Champions League – Europe’s biggest club football tournament
while Budweiser continues to enjoy its longstanding funding of FIFA World Cup tournaments. In 2019, AB InBev beer brand announced new multi-
year global partnerships with the English Premier League (EPL) and Spain’s La Liga. Guinness Nigeria on the other hand is involved in sponsoring
three clubs in the Nigerian Professional Football League (NPFL)
4
Agusto & Co estimates
5
The World Health Organisation (WHO)
6
Heineken recently increased its ownership in local brewer – Champion Breweries Plc (through its wholly-owned subsidiary Raysun Nigeria
Limited) to 84.7% to further secure its dominant market position in Nigeria.
5 2020 Corporate Rating ReportInternational Breweries Plc.
Agusto & Co. estimates that the Industry’s revenue dipped by at least 10% to around ₦530 billion in 2020 to
reflect low sales due to the prolonged restrictions on social life during the year as the industry missed out on
some festive seasons and big events where large volume of beer would have been consumed. We anticipate
an upward adjustment to product prices by the three major brewers to provide for the adverse effect of
inflation, currency devaluation and excise duty on cost of operations. Given that consumers in Nigeria
(especially value lager drinkers) are price-sensitive, we expect consumption to remain about the same level or
drop slightly but the higher product prices will more than compensate for the lost volume, hence our belief
that the Industry’s revenue will inch up to ₦580 billion in 2021.
To remain competitive, we expect top brewers in the country to deploy unconventional marketing strategies 7
to drive brand patronage while maintaining market share. However, these marketing and promotional activities
will have huge cost implications, which when combined with the rising input costs caused by the worsening
inflationary and currency devaluations, should result in lower margins. Hence, we expect overall profitability
and cash flow in 2021 to remain below pre-COVID levels.
Based on the latest Purchasing Managers’ Index (PMI) Report released by the Central Bank of Nigeria, the
manufacturing PMI for the Food, Beverage & Tobacco, which measures the level of business activities within
the sector, rose to 51.3 points in December 2020 after enduring contractions due to the COVID-19 induced
lockdown. Although the COVID-19 pandemic continues to have an adverse effect on performance of brewers,
we do not foresee insolvency of any of the three major players considering the strong support from global
parents and technical partners. Furthermore, we expect the performance of brewers to continue to be
demonstrative of resilience as seen over various economic cycles supported by the country’s large and growing
legal drinking age population. Based on the above, we have attached a stable outlook to the Brewery Industry
in Nigeria.
7
International Breweries launched the “Naija Bar Rescue” campaign that is targeted at supporting local bars and restaurants across the country,
while Guinness Nigeria followed suit with its “Raise the Bar” aimed at providing special care packages to bartenders and bar owners across the
country.
6 2020 Corporate Rating ReportInternational Breweries Plc.
PROFILE OF INTERNATIONAL BREWERIES PLC
Overview & Background
International Breweries Plc (“International Breweries”, “INTERBREW”, “IBPLC” or “the Company”) is one of the
leading players in the Nigerian Brewery Industry engaged in the brewing, packaging and marketing of alcoholic
and non-alcoholic beverages. IBPLC was first incorporated as a private limited liability company in December
1971 under the name International Breweries Limited but commenced production eight years later with the
launch of its flagship brand – Trophy Lager. International Breweries later became a public limited company
when its shares were listed on the Nigerian Stock Exchange in April 1995.
The Company has witnessed several changes in its ownership profile over the last decade. In 2008, the
Warsteiner Group sold its majority shareholding in the Company to the Castel Group. However, the control of
the Castle Group was short-lived after SABMiller took over the operations and management of the Company
following a strategic alliance with the Castel Group in January 2012. During this period, significant investments
were made including the construction of the Onitsha brewery plant. In 2016, AB InBev acquired controlling
stake in SABMiller globally and International Breweries Plc subsequently became “the instrumental vessel” for
AB InBev’s strategic entrance into the Nigerian Brewery Industry. Thus, IBPLC is a part of the AB InBev family
– the world’s largest brewer which has operations in more than 50 countries worldwide and a presence in
virtually every major beer market across the globe. AB InBev has over 200 beer brands, notably Budweiser,
Corona Extra, Stella Artois, Bass and Hoegaarden, and maintains a technical/management agreement with
IBPLC for various brewed products.
Figure 2: Key Milestones in International Breweries Plc’s History
1971 1995 2012 2017 2020
Incorporated as Listed on the SABMiller invested in Merged with Intafact Raised ₦164.4 billion
International Breweries Nigerian Stock the Ontisha plant after Beverages Limited and in rights issue – the
Limited Exchange (NSE) its strategic alliance Pabod Breweries largest equity issuance
with the Castle Group Limited in the Nigerian Capital
Market
1978 2010 2018
2016
Commenced Launched new products Commissioned
AB InBev acquired
=
production of its in the malt, lager and Sagamu plant and
SABMiller worldwide
flagship product – stout segments launched premium
Trophy Lager Budweiser in Nigeria
Source: IBPLC’s Management Presentation
In 2017 the Board through a scheme of merger sanctioned by the Federal High Court, approved that AB InBev’s
majority shareholding in Intafact Beverages Limited and Pabod Breweries Limited (companies with similar
objectives) be merged with International Breweries Plc for better operational efficiencies and synergies of
larger production capacity. With the merger, IBPLC’s now has four brewery plants located in Ilesa (Osun State),
Onitsha (Anambra State), Port Harcourt (Rivers State) and most recently, Sagamu (Ogun State). The Company
7 2020 Corporate Rating ReportInternational Breweries Plc.
has also expanded its product portfolio to include Budweiser, Trophy Stout, Trophy Lager, Castle Lite, Hero
Lager, Eagle Lager, Eagle Stout, Grand Malt and Beta Malt.
On 15 October 2019, shareholders approved that a rights issue be conducted to deleverage the Company’s
books. Consequently, 18,266,206,614 ordinary shares of ₦0.50 each was offered to existing shareholders at
₦9.00 per share on the basis of 17 new ordinary shares for every 8 ordinary shares held as at 6 November,
2019. The rights issue was fully subscribed and the proceeds of ₦164,395,859,526 were used to significantly
reduce the Company’s debt portfolio and interest burden.
International Breweries Plc prioritizes health, safety, quality and environmental protection (HSEQ) in line with
international best practices. The Company’s brands are in conformity with the certification criteria of the
Standards Organisation of Nigeria (SON) and the National Agency for Food and Drug Administration and
Control (NAFDAC), thus demonstrating its unwavering compliance with hygiene and health standards.
Ownership Structure
Post rights issue, Brauhaase International Management GMBH and its ultimate holding company – AB InBev
Nigeria Holding BV held 87.29% controlling stake in International Breweries Plc, while the remaining shares
are owned collectively by other individual and institutional investors with none controlling up to 5% as at 30
September 2020. Therefore, AB InBev is the ultimate parent company of International Breweries Plc.
Board Composition and Structure
International Breweries Plc has a fourteen-member Board of Directors, which comprised eleven Non-Executive
Directors and three Executive Directors. HRM Nnaemeka A. Achebe CFR, MNI leads the Board as the Chairman,
while Mr Hugo Dias Rocha is the Managing Director following the resignation of erstwhile MD - Mrs Annabelle
Degroot.
Table 2 - Current Directors
Name Designation Nationality
HRM Nnaemeka A. Achebe CFR, MNI Chairman Nigerian
Mr Hugo Dias Rocha Managing Director Brazilian
Mr Bruno Zambrano Arana Finance Director Colombian
Mrs Tolulope Adedeji Marketing Director Nigerian
Otunba Michael Daramola Non-Executive Director Nigerian
Mr Sunday Akintoye Omole Non-Executive Director Nigerian
Mr Olugbenga Awomolo Non-Executive Director Nigerian
Mr Andrew Murray Non-Executive Director American
Mr Richard Rivett-Carnac Non-Executive Director American
HRM Igwe Peter Anugwu JP, OFR Non-Executive Director Nigerian
Mr Michael Ajukwu Non-Executive Director Nigerian
Mrs Abiye Tobin-West Non-Executive Director Nigerian
Mr Andrew Whiting Non-Executive Director South African
Ms Olutoyin M. Odulate Independent Director Nigerian
Source: IBPLC’s 2019 Annual Report and Management Presentation
The Company’s Board of Directors operates through three Board Committees – the Governance, Remuneration
& Nomination Committee, the Risk Management & Sustainability Committee and the Audit & Risk Committee.
Mr Michael Ajukwu leads the Governance, Remuneration & Nomination Committee with support from three
Non-Executive Directors. The Risk Management & Sustainability Committee is chaired by Mr Olugbenga
Awomolo and has four other Non-Executive Directors as its members. The six-man Audit and Risk Management
8 2020 Corporate Rating ReportInternational Breweries Plc.
Committee, whose members are split equally between shareholders and Non-Executive Directors, is led by Mr
Oladepo Adesina (shareholders’ representative).
Operating Structure
International Breweries Plc operates four factories located in Ilesa (Osun State), Sagamu (Ogun State), Port
Harcourt (Rivers State) and Onitsha (Anambra State) as well as sales and corporate offices in Oregun and Ikoyi
respectively (both within the Lagos metropolis). The brewery plants have a combined installed production
capacity of about 9 million hectolitres and operated at an estimated utilisation rate of circa (c) 70% during FYE
2019. IBPLC has a wide and diversified product portfolio across the alcoholic (lager and stout) and non-
alcoholic (malt) categories and extensive networks of retailers, wholesalers and distributors with strong
presence in the eastern and western parts of the country. Management plans to scale up existing capacity by
25% within the next two years to meet consumers’ growing demand for its products.
Table 3: IBPLC’s Brand Portfolio
Category Category Products
Premium Budweiser
Alcoholic Core+ Castle Lite and Trophy Stout8
Core Trophy Lager, Hero Lager and Eagle Stout
Affordable Eagle Lager
Non-alcoholic Malt Grand Malt and Beta Malt
Source: Management Presentation
Other Information
As at 31 December 2019, International Breweries Plc’s total assets and liabilities stood at ₦365.1 billion and
₦357.7 billion respectively, while total shareholders’ fund was ₦7.5 billion. In the FYE 2019, the Company
generated net revenue (turnover less excise duties) of ₦132.4 billion and recorded a loss after tax of ₦27.8
billion (2018 loss after tax of ₦3.9 million). In the same period, IBPLC had an average of 2,231 persons in its
employment (2018: 2,249 persons).
Table 4 - Background Information
Authorised Share Capital: ₦4.3 billion
Paid-up Capital: ₦4.29 billion
Shareholders’ Funds: ₦7.5 billion
Registered Office: 22/36 Glover Road, Ikoyi, Lagos, Nigeria.
Principal Business: Brewing, packaging and marketing of alcoholic and non-alcoholic beverages
Auditors: PricewaterhouseCoopers
Source: IBPLC 2019 Annual Report
8
Trophy Stout was launched in April 2020
9 2020 Corporate Rating ReportInternational Breweries Plc.
FINANCIAL CONDITION
ANALYSTS’ COMMENTS
We have analysed the audited financial statements of International Breweries Plc (“International Breweries”, “IBPLC”, or “the Company
for the three-year ended 31 December 2019. However, the Company’s 2017 accounts were for a nine month period after it adopted a new
accounting year-end post- merger with Intafact Beverages Limited and Pabod Breweries Limited.
PROFITABILITY
The Company’s principal business involves brewing, packaging and marketing of alcoholic and non-alcoholic
beverages, with flagship products in the premium, core and affordable categories including Budweiser, Castle
Lite, Trophy Stout, Trophy Lager, Hero Lager, Eagle Stout, Eagle Lager, Grand Malt and Beta Malt. IBPLC
typically adopts nationwide and regional route to market strategies, which explains the strong brand
dominance and acceptance of some of its products in certain parts of the country.
Over the last three years, the performance of brewers in Nigeria has been influenced by two primary factors –
fiscal tariffs and competition. The regulatory headwinds of higher excise tax following the introduction of a
new tariff structure for alcoholic beverages in June 2018 have seen most brewers report weaker top line
growth. Also, the destructive beer war has continued to pressure the Industry’s operating margins as the battle
for consumers’ shrinking wallets intensified. Consequently, most operators have continued to absorb
incremental costs in a bid to protect their existing market share given consumers’ sensitivity to changes in
product prices.
In the financial year ended 31 December 2019, International Breweries Plc recorded a revenue of ₦132.4
billion, which represented a 9.7% increase over previous year’s performance, to reflect higher volume sales
across the alcoholic and non-alcoholic segments supported by the rapid expansion of the Company’s
distribution channels during the period. A breakdown of the Company’s FYE 2019 revenue by business segment
showed that the beer segment accounted Figure 3: Breakdown of net sales by product segment (2017 – Q3’2020)
for about 83% of sales with strong
contribution from Hero and Trophy brands, Alcohol Non-alcohol
while non-alcoholic beverage (dominated 100%
14% 9%
by Beta Malt) accounted for the rest. 90% 17% 17%
80%
The bulk of raw materials (malts and hops) 70%
used in the Company’s brewing process are 60%
sourced abroad, which makes IBPLC’s 50%
91%
input costs to be highly susceptible to 40% 86% 83% 83%
foreign currency risks. Also, prices of other 30%
locally sourced ingredients like rice, maize 20%
and sorghum have maintained upward 10%
trajectories over the last five years amid 0%
persistent herder-farmer clashes that has Q3'2020 2019 2018 2017
continued to threaten food supply in the
country. Furthermore, the Company’s cost of sales was impacted by a higher depreciation charge during the
period arising from the increase in property plant & machinery (PPE) following the completion of its Sagamu
plant. Consequently, the Company’s cost of sales to revenue ratio rose sharply to 81% in FYE 2019 (2018:
10 2020 Corporate Rating ReportInternational Breweries Plc.
70.1%), thus resulting in a significantly lower gross profit margin of 19% in the same period. Similarly, IBPLC’s
operating expense to revenue ratio grew by more than a thousand basis points to 31.8% in FYE 2019 due to
spikes in marketing, promotion and distribution expenses during the year. Overall, IBPLC posted an operating
loss margin of 12.8% in 2019 compared to the operating profit margin of 8.6% in the previous year. Agusto &
Co. believes that the huge costs incurred Figure 4: Operating Profit Margin (2017 – Q3’2020)
on promotional and sponsorship activities,
which have become a huge part of IBPLC’s INTBREW NB GUINNESS
market penetration strategy, will continue 20.0%
to pressure margins in the near term. 15.9%
15.0%
However, the health risks associated with 10.6% 11.1% 11.4%
9.4% 8.6% 8.9%
organising such events could prompt the 10.0% 7.4%
6.5%
Company to cut back on sums spent on
5.0%
musical concerts and other promotional 0.5%
events as it continues to explore other 0.0%
Q3'2020 2019 2018 2017
cheaper online and non-physical channels -5.0%
of connecting with customers.
-10.0%
In 2019, the Company’s other expenses -15.0% -12.8%
arising mainly from loss on derivatives -15.2%
-20.0%
amounted to ₦0.96 billion, while other
income from sale of wastes and scraps was ₦0.29 billion, thus resulting in a net other expense to revenue ratio
of 3.1%. In the same period, IBPLC’s finance cost (comprising interest on bank borrowings) to revenue ratio
improved marginally to 11.5% (2018:13.3%) but remained way above our benchmark of 5%. However, the
recent recapitalization of the Company has seen interest expense to revenue drop to 3.3% in the third quarter
of 2020 after proceeds from the recent rights offer were used to pay off some of the expensive bank borrowing
on its books. Based on management’s plan to refinance existing foreign currency loan with cheaper Naira
denominated long-tenured debt issuances, we expect a further reduction in the Company’s interest burden.
On account of the losses incurred over the last three years, IBPLC’s profitability metrics (ROA & ROE) have
remained in the negative territory, depicting a weak performance. Although International Breweries’ finance
costs post-rights issue has trended downwards, its overall performance in the nine months ended 30
September 2020 (unaudited) remained frail – with an operating loss of ₦10.5 billion. However, the Company
is currently moving away from its predatory pricing to a cost-based pricing strategy evidenced by the recent
decision to increase prices across its product portfolio. Also, IBPLC intends to rein in on its operational costs
(particularly advertising and promotion expenses) to protect its bottom line from further decline.
Going forward, management plans to deepen market presence with the ongoing expansion of the Company’s
product portfolio supported by the launch of its new brand - Trophy Stout in 2020. Furthermore, IBPLC is
currently improving production capacities at its factories whilst optimising its route-to-market strategy. While
we believe the recent price increase will somewhat cushion the adverse impact of the graduated increase in
excise duties on top line growth, we do not expect International Breweries’ financial performance in FYE 2021
to reflect profit.
In our opinion, International Breweries Plc’s profitability is weak and requires improvement
11 2020 Corporate Rating ReportInternational Breweries Plc.
CASH FLOW
International Breweries Plc generates cash from the sale of alcoholic and non-alcoholic beverages to
customers through its extensive distribution networks across the country. Products are sold to distributors on
cash basis but trade credits of up 30 days are granted to key distributors that meet the Company’s risk
assessment criteria. Although the intense rivalry within the domestic brewery market has seen most operators
(including IBPLC) offer extended credit periods to major distributors in a bid to remain competitive. Agusto &
Co. notes positively that more than three quarters of the Company’s trade receivables as at year-end 2019 fell
within the allowable range of 0 - 30 days, thus signifying efficiency in its sales and cash collection process.
In the financial year ended 31 December 2019, International Breweries recorded an operating cash flow (OCF)
of ₦55.5 billion, which represented a significant increase from prior year’s deficit of ₦31.5 billion. This
improvement was driven by spikes in trade creditors and amounts due to related parties as well as a reduction
in trade receivables during the period.
Figure 5: Operating cash flow to sales ratio (2017 – Q3’2020)
International Breweries Plc’s OCF in 2019
was more than sufficient to cover returns 350.0%
to providers of finance of ₦15.2 billion, 300.0%
288.3%
which wholly comprised interest
250.0%
payments. IBPLC’s cumulative OCF over
the last three years (2017 – 2019) of 200.0%
₦129.3 billion was also enough to cover
150.0%
cumulative returns to providers of finance
(interest payments) of ₦36.5 billion. 100.0%
42.0%
50.0% 26.3%
Furthermore, International Breweries’
operating cash flow as a percentage of 0.0%
Q3'2020 2019 2018 2017
sales rebounded to 42% in FYE 2019 from -50.0% -26.1%
a negative position in the previous year,
while the cumulative OCF to sales ratio over a three year (2017 – 2019) period of 44.7% was better than our
benchmark. However, we recognise that the average ratio benefited from the swelling effect of huge
consolidation adjustments in 2017 following AB InBev’s acquisition of controlling interest in the IBPLC, which
led to its merger with two other entities9 that are also controlled by AB InBev.
In the nine months ended 30 September 2020 (unaudited), International Breweries’ operating cash flow
moderated to ₦22 billion compared to similar period in 2019 to reflect the adverse impact of the COVID-19
pandemic on overall demand and consumption levels for alcoholic beverages. However, we expect the
Company’s earnings and OCF to bounce back over the medium term given its strong brands across the beer
categories as well as its wide distribution network and affordable price points. Overall, we believe International
Breweries’ favourable terms of trade with its customers and suppliers as well as increasing support from related
parties will continue to support its operating cash flow despite persistent loss making position.
In our opinion, International Breweries Plc’s overall cash flow position is satisfactory.
9
The merged entities are Intafact Beverages Limited and Pabod Breweries Limited
12 2020 Corporate Rating ReportInternational Breweries Plc.
LIQUIDITY PROFILE
As at 31 December 2019, the Company’s liquidity position comprised cash and equivalents (excluding restricted
cash held as collateral deposit) of ₦15.6 billion and committed undrawn bank lines amounting to about ₦79.8
billion (comprising local currency of ₦24.28 billion and foreign currency of $146 million). International
Breweries’ undrawn bank lines are sourced from two banks10. During the period under review, the Company
relied on bank loans to fund its working capital need and expansion projects. The interest rates on these loans
range from 21% to 23% with maturities of one year to three years. We note positively that most of these loans
were repaid in 2020 with proceeds of the rights issue as the Company’s continues to realign its capital
structure.
Based on International Breweries Plc’s sizeable cash balance and committed undrawn credit lines, coupled
with its strong market reputation, good credit history and ability to raise finance (both from its lenders and
shareholders) at short notice to support its operations, we consider the Company’s liquidity profile to be
satisfactory.
FINANCING STRUCTURE AND ADEQUACY OF WORKING CAPITAL
As at 31 December 2019, International Breweries Plc’s working assets remained largely unchanged at ₦44.9
billion (2018: ₦44.2 billion) as increase in other debtors & prepayments was offset by almost similar decrease
in trade debtors during the period. The Figure 6: STFS vs LTFN (2017 – Q3’2020)
components of the Company’s working
assets as at FYE 2019 were trade debtors STFS LTFN
(51%), stocks (38%) and other debtors & 100.0
prepayments (11%). 68.6 74.2
80.0
60.0 49.1
As at FYE 2019, IBPLC’s spontaneous
40.0
financing (non-interest bearing liabilities)
₦'billion
13.9
20.0
rose sharply by 62% year-on-year to ₦94
0.0
billion, driven principally by spikes in
-20.0 Q3'2020 2019 2018 2017
outstanding balances owed to both trade -17.3
-40.0 -21.9 -24.9
creditors11 and related parties during the
-60.0
year. IBPLC’s spontaneous financing was
-80.0
more than sufficient to finance working
-100.0 -85.9
assets, leaving a short-term financing
surplus (STSF) of ₦49.1 billion as at year end. Over the last three years (2017 – 2019), International Breweries
Plc has consistently recorded short term financing surpluses on account of its favourable terms of trade as well
as the strong support it enjoys from its parent company – AB InBev. Therefore, Agusto & Co. expects the
Company to continue to benefit from financing surplus in the short term.
As at 31 December 2019, International Breweries Plc’s long term assets grew by 16% to ₦288.4 billion on
account of ongoing capacity expansion of its production and packaging lines during the year. As at the same
10
The banks are Citibank N.A. at Abu Dhabi Global Market (ADGM) and Standard Chartered Bank Nigeria
11
The Company’s trade payables are typically settled within 30 days of the date of recognition.
13 2020 Corporate Rating ReportInternational Breweries Plc.
date, the Company’s long term funds of ₦271.1 billion, which comprised long term borrowings (97%) and
equity (3%), were insufficient to cover long term assets, resulting in a long term financing need (LTFN) of ₦17.3
billion. However, the Company’s short-term financing surplus was sufficient to cover the long-term financing
need, resulting in an overall working capital surplus of ₦31.8 billion as at year-end 2019, which is a major
improvement from the working capital deficiencies of prior years.
The Company’s capital structure was significantly altered subsequent to year-end 2019 following a successful
rights issue that increased its shareholders’ equity by nearly twentyfold to about ₦150 billion as at 30
September 2020. Despite the additional funding from the recent recapitalisation, IBPLC’s long term financing
need continued because proceeds from the rights issue were used to replace existing term loans as the
Company sought to realign its funding sources. Similar to FYE 2019, the Company’s short time financing surplus
of ₦68.6 billion was more than sufficient to cover the long term financing need of ₦21.7 billion, leaving an
overall working capital surplus of ₦46.8 billion as at Q3’2020, which we consider satisfactory.
Going forward, the Company plans to inject fresh long tenured debt at relatively cheaper financing costs into
its funding mix to ease IBPLC’s interest burden. In addition, we believe increasing trade credits from both
suppliers and related parties coupled with management’s decision to rein in on trade receivable and inventory
levels will continue to support its overall working capital position.
In our opinion, International Breweries Plc has adequate working capital although the continuous depletion of
its long term funding capacity (equity) amid persistent losses remains a concern.
LEVERAGE
As at 31 December 2019, International Breweries Plc’s total liabilities stood at ₦357.7 billion, representing a
30% growth from the prior year to reflect increases in both non-interest bearing and interest bearing liabilities
during the year. Nearly three quarters of the IBPLC’s total liabilities as at year-end 2019 were interest bearing
borrowings while the rest are outstanding interest-free liabilities12.
International Breweries Plc increased its stock of short-term borrowings during the year after it obtained
additional $300 million bridge loan that had a maturity date of January 2020. This is in addition to the unpaid
portion of the $424 million loan obtained from Citibank Nigeria Limited in 2018 for which the Company has
entered into a non-deliverable forward (NDF) contract to hedge against potential foreign currency risk.
International Breweries Plc also has a ₦24.2 billion committed but undrawn revolving credit facility with
Standard Chartered Bank Nigeria.
As at 31 December 2019, the Company’s total assets of ₦365.1 billion were funded by interest bearing
liabilities (72.2%), non-interest bearing liabilities (25.8%) and equity (2%), thus depicting a very low equity
cushion as retained losses year-on-year continue to erode shareholders’ equity. However, Agusto & Co notes
positively ongoing plans by management to deleverage the Company’s balance sheet by year-end 2021
through rights offer to existing shareholders.
12
The main components of the Company’s ₦37.2 billion non-interest bearing liabilities as at FYE 2019 are amounts due to related parties (40%),
trade debtors (33%) and other creditors & accruals (22%). The amounts due from related parties are payables arising from the international
sourcing of premium beer and raw materials from the parent and fellow subsidiaries within the AB InBev family as at year-end.
14 2020 Corporate Rating ReportInternational Breweries Plc.
The Company’s interest coverage ratio (less finance charge on leased liabilities) improved markedly to 3.7x in
FYE 2019 from a deficit of 2x in FYE 2018. In the same vein, IBPL’s three-year (2017 – 2019) cumulative
interest cover of 3.6x, buoyed by the positive impact of the business combination13 in November 2017, was
better than our benchmark and compared Figure 7: Interest Expense to Sales Ratio (2017 – Q3’2020)
favourably with selected industry peers.
However, the Company’s interest expense INTBREW NB GUINNESS
to sales ratio of 11.5% in FYE 2019 was 14.0% 13.3%
more than double our benchmark of 5% 12.3%
12.0% 11.5%
although we expect the ratio to improve
considerably with the successful 10.0%
replacement of bank loans with equity. 7.8%
8.0%
Furthermore, the Company’s net debt to
total assets ratio of 104% and IBL as a 6.0%
percentage of equity of 3,106% as at the 4.4%
3.9%
4.0% 3.5%
same date, were both worse than our 3.3% 2.6%
benchmarks and underlines IBPLC’s high 2.0% 1.7%
2.0% 1.2%
leverage position.
0.0%
Subsequent to year-end 2019, the Q3'2020 2019 2018 2017
Company obtained regulatory approval for
the allotment of additional shares issued by way of rights offer to shareholders. The full proceeds of the rights
issue, which stood at ₦164.4 billion, was utilized to liquidate some existing bank loans, thus the Company’s
interest bearing liabilities declined by 59% ₦107.3 billion as at 30 September 2020 (unaudited). In the same
period, IBPLC’s interest expense to sales ratio fell to 3.3% compared to an average of about 12.3% over the
last five years, while interest coverage ratio more than doubled to 7.9x. Also, the Company’s net debt to total
assets and IBL to equity ratios improved to 52% and 40% respectively to reflect the marked reduction in interest
bearing borrowings during the period.
Going forward, management intends to take advantage of the low interest rate climate to further reduce the
Company’s finance costs by refinancing outstanding foreign currency bank loan with cheaper long-tenured
local currency debt instruments. If successful, the planned bond issuance should have a positive impact on
IBPLC’s leverage position in the near to medium term.
In our opinion, International Breweries Plc’s leverage is satisfactory reflecting the positive impact of recent
recapitalization on its capital structure.
13
Following AB InBev’s acquisition of controlling interest in SABMiller, a merger arrangement was consummated between International Breweries
Plc and two other entities (Intafact Beverages Limited and Pabod Breweries Limited), which are all under the same control in line with IFRS 3
15 2020 Corporate Rating ReportInternational Breweries Plc.
OWNERSHIP, MANAGEMENT & STAFF
International Breweries Plc registered an additional 21.4 billion units of ordinary shares in 2019, thus
increasing its authorized share capital to ₦15 billion split into 30 billion units of ordinary shares at 50 kobo
each as at 30 September 2020. The Company’s issued and fully paid up share capital equally increased to
₦13.4 billion as at end of third quarter of 2020 (FYE 2019: ₦4.29 billion) following the completion of the
recapitalisation and rights offer during the year. AB InBev indirectly controls 87.29% equity stake in
International Breweries Plc through AB InBev Nigeria Holding Company BV (78.44%) and Brauhaase
International Management GMBH (8.85%), while the remaining shares are held by other individuals and
corporate investors.
Figure 8: IBPLC’s Shareholding Structure as at 30 September 2020
Brauhaase
International
AB InBev Nigeria
Management
Holding Company
GMBH
Others AB InBev BV
8.85%
12.71% 87% 78.44%
As at 30 September 2020, the Company had a fourteen-member Board of Directors, which comprised eleven
Non-Executive Directors and three Executive Directors. HRM Nnaemeka A. Achebe, CFR, MNI leads the Board
as the Chairman, while Mr Hugo Dias Rocha is the Managing Director following his appointment in January
2020 after Mrs Annabelle Degroot (erstwhile MD) exited the Board to take up a new role in Europe within the
AB InBev Group. IBPLC witnessed a few personnel entry and exit at both the Board and management levels
over the last two years. Mr Zuber Momoniat – former Finance Director resigned from the Board effective 31
December 2019 and was replaced by Mr Bruno Zambrano Arana the following day. Also, Mr Godwin Oche
resigned his position as Marketing Director in 2019 and Mrs Tolulope Adedeji was appointed in his stead. In
September 2020, Mr Andrew Whiting was appointed as a Non-Executive Director.
The Company’s Board of Directors operates through three Board Committees – the Governance, Remuneration
& Nomination Committee, the Risk Management & Sustainability Committee and the Audit Committee. The
Directors of International Breweries Plc are drawn from diversified background with vast experience in board
management.
International Breweries Plc’s management team comprises ten members, each reporting directly to the
Managing Director. We note that majority of the management team have worked within the AB InBev Group in
16 2020 Corporate Rating ReportInternational Breweries Plc.
various capacities and countries in the past. In addition, the members of the management team have extensive
knowledge of the country’s Brewery Industry, hence our opinion that the management team is qualified and
experienced.
As at 31 December 2019, International Breweries Plc had a staff strength of 2,231 employees (2018: 2,249
employees). The Company’s average cost per employee increased by 27% to approximately ₦5 million in 2019
to reflect the full year impact of the salaries and other entitlements of employees that joined the workforce
midway into 2018 after the Sagamu plant was commissioned. The Company’s operating profit (before
deducting staff cost) per employee plunged into the negative territory in 2019 as a result of the operating loss
in the period, thus depicting a weak staff productivity.
Management Team
Mr Hugo Dias Rocha is the Managing Director of International Breweries Plc. He has worked with AB InBev
Group for over 24 years in different leadership roles across the Sales, Process Integration and Human Resources
functions in various countries including home country Brazil, Dominican Republic, China, Colombia, Argentina
and South Africa. He holds a Bachelor’s Degree in Mechanical Engineering from the Federal University, Paraiso
and a Master of Business Administration (MBA) from the Sao Paulo Business School, Brazil.
Mr Bruno Zambrano Arana is the Finance Director of International Breweries Plc and was appointed to the
Board as an Executive Director in January 2020. Prior to joining International Breweries Plc, he was the Finance
Director at Tanzanian Breweries. Mr Arana has worked extensively in virtually all aspects of financial
management across the AB InBev’s operations in Latin America and East Africa. He holds a Bachelor’s Degree
in Economics from the University of Texas at Arlington and a Master of Business Administration (MBA) from
McCombs School of Business at Austin Texas.
Table 5: Other Members of International Plc’s Management Team
Name Position
Mrs Tolulope Adedeji Marketing Director
Mr Wil Fameni Procurement Director
Mr Tony Agah Brewery Operations Director
Mrs Marilyn Maduka People Director
Mr Coutino Carlos High End-Lagos Transformational Director
Mrs Temitope Oguntokun Legal & Corporate Affairs Director
Mr Harry De Wet Logistics Director
Mr Eduardo Cáceres Head Revenue - PPM
Source: IBPLC’s Management Presentation
17 2020 Corporate Rating ReportInternational Breweries Plc.
OUTLOOK
So far, the impact of the current COVID-19 on beer sales and consumption has been different from the
experience of the 2016 recession owing to its attendant twin challenges of subdued consumer spending, akin
to recessionary periods, and restrictions on social life, which is the main driver of sales. With the reopening of
on-premise beer sales and the relaxation of restrictions on activities of nightclubs, pubs, and beer parlours in
some states, and the successes of the COVID-19 vaccine, we remain upbeat that beer consumption will bounce
back slightly in 2021. Despite our optimism, we do not believe the industry’s top line growth in 2021 will
surpass pre-COVID levels. Furthermore, we expect the performance of the Industry to be adversely impacted
by the weakening purchasing power of consumers which will increase price sensitivity and potentially drive
up demand for competitively priced value brands and local brews. Also, the proliferation of religious based
policies (particularly in the northern part of the country) that are inimical to beer distribution and consumption
could stifle volume growth in these regions
Although International Breweries revenue grew by 9.7% to ₦132.4 billion during the FYE 2019, its unaudited
accounts for the nine months ended 30 September 2020 (Q3’2020) showed a 2% dip owing to lower sales
recorded during the COVID-19 lockdown as production and supply channels were disrupted by the restriction
on movement. Despite the gains from the rights issue, which significantly reduced IBPLC’s interest burden in
Q3’2020, its weak financial performance persisted amid spike in operational costs exacerbated by the the
country’s spiralling inflation and currency devaluations during the period. Consequently, the Company posted
a loss before tax of ₦17.7 billion in Q3’2020 and is poised to record a loss for the 2020 financial year – its
fourth year of consecutive losses.
Going forward, management has disclosed plans to improve margins across its product portfolio by
implementing another upward price adjustment in 2021 whilst ensuring cost efficiencies across the business.
IBPLC has also initiated a route-to-market optimisation strategy which seeks to aggressively drive volumes
across existing and new markets. This is in addition to ongoing investments to scale up its production capacity
by 25% by 2022 to meet growing demand for its products. Other initiatives include increased local sourcing of
input materials and the installation of alternate power sources (solar and gas) at its Sagamu plant towards
reducing its energy costs. Given its antecedent, it is unlikely for the Company to record a profit in 2021 but we
expect these initiatives to have positive impact on its profitability in the medium to long term.
Notwithstanding the plight of the COVID-19 pandemic, Agusto & Co expects International Breweries’ cash flow
and working capital to remain within acceptable levels based on our view that the Company will continue to
enjoy favourable terms of trade with customers, suppliers and related parties. Furthermore, we expect the
Company’s debt profile and interest burden to reduce should it take advantage of the current low yield
environment in the country’s capital market to raise local currency debt to refinance the outstanding foreign
currency exposure on its books.
Agusto & Co hereby attaches a stable outlook to International Breweries Plc as we believe IBPLC will continue
to enjoy strong technical, administrative and financial support from the AB IBev Group given its strategic
importance to the Group’s operations on the African continent.
18 2020 Corporate Rating ReportInternational Breweries Plc.
FINANCIAL SUMMARY
STATEMENT OF FINANCIAL POSITION 30-Sep-20 31-Dec-19 31-Dec-18
Unaudited
₦'000 ₦'000 ₦'000
ASSETS
IDLE CASH 27,974,053 7.6% 15,694,953 4.3% 7,784,561 2.5%
MARKETABLE SECURITIES & TIME DEPOSITS 18,814,246 5.1% 16,111,256 4.4% 9,573,289 3.1%
CASH & EQUIVALENTS 46,788,299 12.8% 31,806,209 8.7% 17,357,850 5.6%
FX PURCHASED FOR IMPORTS - - -
ADVANCE PAYMENTS AND DEPOSITS TO SUPPLIERS - - -
STOCKS 20,752,141 5.7% 16,940,448 4.6% 16,140,693 5.2%
TRADE DEBTORS 19,610,145 5.4% 23,107,663 6.3% 25,538,562 8.2%
DUE FROM RELATED PARTIES - - -
OTHER DEBTORS & PREPAYMENTS 146,333 0.0% 4,902,855 1.3% 2,482,484 0.8%
TOTAL TRADING ASSETS 40,508,619 11.1% 44,950,966 12.3% 44,161,739 14.2%
INVESTMENT PROPERTIES - - -
OTHER NON-CURRENT INVESTMENTS - - -
PROPERTY, PLANT & EQUIPMENT 260,189,461 71.0% 271,160,046 74.3% 243,373,657 78.4%
SPARE PARTS, RETURNABLE CONTAINERS, ETC - 5,035,942 1.4% 3,716,848 1.2%
GOODWILL, INTANGIBLES & OTHER L T ASSETS 19,011,962 5.2% 12,193,370 3.3% 1,698,400 0.5%
TOTAL LONG TERM ASSETS 279,201,423 76.2% 288,389,358 79.0% 248,788,905 80.2%
TOTAL ASSETS 366,498,341 100.0% 365,146,533 100.0% 310,308,494 100.0%
Growth 0.4% 17.7% 33.7%
LIABILITIES & EQUITY
SHORT TERM BORROWINGS - - 28,386,435 9.1%
CURRENT PORTION OF LONG TERM BORROWINGS - 113,881,753 31.2% 35,052,442 11.3%
LONG-TERM BORROWINGS 107,320,670 29.3% 149,753,338 41.0% 153,738,160 49.5%
TOTAL INTEREST BEARING LIABILITIES (TIBL) 107,320,670 29.3% 263,635,091 72.2% 217,177,037 70.0%
TRADE CREDITORS 93,713,683 25.6% 31,484,836 8.6% 11,925,626 3.8%
DUE TO RELATED PARTIES - 37,154,853 10.2% 20,714,990 6.7%
ADVANCE PAYMENTS AND DEPOSITS FROM
CUSTOMERS
OTHER CREDITORS AND ACCRUALS 11,054,266 3.0% 20,794,120 5.7% 21,430,597 6.9%
TAXATION PAYABLE 1,759,206 0.5% 1,983,825 0.5% 1,445,591 0.5%
DIVIDEND PAYABLE
DEFERRED TAXATION - - -
OBLIGATIONS UNDER UNFUNDED PENSION SCHEMES 2,630,107 0.7% 2,630,107 0.7% 2,500,402 0.8%
MINORITY INTEREST
REDEEMABLE PREFERENCE SHARES
TOTAL NON-INTEREST BEARING LIABILITIES 109,157,262 29.8% 94,047,741 25.8% 58,017,206 18.7%
TOTAL LIABILITIES 216,477,932 59.1% 357,682,832 98.0% 275,194,243 88.7%
SHARE CAPITAL 13,431,034 3.7% 4,297,931 1.2% 4,297,931 1.4%
SHARE PREMIUM 159,803,396 43.6% 6,160,731 1.7% 6,160,731 2.0%
IRREDEEMABLE DEBENTURES
REVALUATION SURPLUS
OTHER NON-DISTRIBUTABLE RESERVES (9,396,382) -2.6% (54,486) 0.0% (194,601) -0.1%
REVENUE RESERVE (13,817,639) -3.8% (2,940,475) -0.8% 24,850,190 8.0%
SHAREHOLDERS' EQUITY 150,020,409 40.9% 7,463,701 2.0% 35,114,251 11.3%
TOTAL LIABILITIES & EQUITY 366,498,341 100.0% 365,146,533 100.0% 310,308,494 100.0%
19 2020 Corporate Rating ReportYou can also read
