‘Employees will be impacted’ – Nigerian Breweries announces cost savings measures

Nigerian Breweries says some employees will be affected by the company’s cost savings measures adopted to improve its finances.

Cost savings measures were adopted by Nigerian Breweries following the N106 billion net loss reported in 2023.

During a media briefing in Lagos on April 17, the company said the workforce will be resized after suspending operations at two of the company’s breweries in Imo and Kaduna states.

Sade Morgan, Nigerian Breweries’ corporate affairs director, said the number of affected staff has not been ascertained.

“This is not a number that we have at this moment, but what we do have is the commitment to keep the number as minimal as possible,” Morgan said.

“How are we going to do that, it’s by exhausting all possibilities of relocating, redistributing our people to our other seven operating breweries.

“And for the affected people, we will ensure that we give them full support and good severance packages, which now are still a subject of discussion with the unions.”

In a statement dated April 12, Nigerian Breweries told the leadership of the National Union of Food, Beverage & Tobacco Employees (NUFBTE) and the Food Beverage and Tobacco Senior Staff Association (FOBTOB) that its proposed plan would include operational efficiency measures.

Also, Nigerian Breweries said soaring inflation rates and foreign exchange (FX) volatility contributed to its net loss last year.

The company said a combination of other challenging economic factors such as heightened operational costs and continued pressure on consumer disposable income also impacted its earnings.

Nigerian Breweries said the resizing is crucial to the company’s quest to return to profitability.

Uaboi Agbebaku, Nigerian Breweries’ legal director, said there is a need to take action to reduce costs overall.

Agbebaku said the resizing and fundraising — through rights issue — are some of the steps taken by Nigerian Breweries to restore profit and give shareholders value.

On April 3, Nigerian Breweries said it would raise N600 billion through rights issue to reduce its debt burden.

The company said its debt and overdue payables were N542 billion last year.