Just recently the brewery giant reported an annual pretax loss of 17.07 billion naira
Guinness Nigeria Plc, a leading Nigerian brewer, is seriously trying to figure out how to manage its $23 million debt. This is because of the lack of foreign exchange liquidity in the local foreign-exchange market has made it challenging for the company to refinance its loans.
Guinness’ Finance and Strategy Director, Stanley Njoroge, disclosed this during an investor call in Lagos.
“We will want to refinance it but there is no foreign currency in the market at the moment,” Mr Njoroge said.
Guinness is Nigeria’s second-largest brewer by market share, saw its outstanding debt rise 16% to N23.2 billion as of June compared to a year ago. Meanwhile, finance costs also rose by 74% to N4.5 billion.
Nigerian companies are struggling to access the greenback after a slump in oil prices cut export earnings, thereby putting immense pressure on the CBN’s capacity to meet dollar obligations to investors and businesses.
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Njoroge admitted, “Foreign exchange is a big concern for us.”
Just recently, the brewery giant reported an annual pretax loss of N17.07 billion ($45 million), hurt by writedowns and COVID-19 induced disruptions. Its share price has gone down almost 9% as of the last trading session.
At the time this report was drafted, the N31 billion market capitalized company was trading around N14.15. It is within striking distance to touch its 52-week low(12.85), and has an unimpressive earning per share value at -5.74.
Nairametrics is, however, bullish on the stock in the long term. Fundamentally, looking at its present dividend yield value which stands at about 10.74% and a price to book ratio of 0.3559, shows that the stock is greatly undervalued.