‘It’s up for discussion’ — Nigerian Breweries MD concerned about inflation data calculation

Hans Essaadi, the managing director of the Nigerian Breweries, has expressed concerns about the calculation of the country’s inflation data, saying “it is up discussions”.

Essaadi spoke on the economic headwinds, including inflation and foreign exchange (FX) devaluation, that significantly impacted the company’s 2024 operations at a recent media briefing.

The National Bureau of Statistics had said Nigeria’s inflation rate dropped from 34.8 percent in December 2024 to 24.48 percent in January after rebasing the consumer price index (CPI).

The Nigerian Breweries, in its 2024 financial statement, said it recorded a revenue of N1 trillion and a gross profit of N319 billion.

With net FX loss growing to N157.5 billion, the beverage producer said it booked a net loss of N144.9 billion in 2024.

Speaking to journalists at the event in Lagos, Essaadi linked the company’s performance to a “lot of volatility” experienced last year.

He said Nigeria’s operating environment is “very hard” to predict — “even when you look ahead a couple of weeks or a few months”.

The managing director also said the West Africa giant would be impacted by the United States’ (US) 14 percent tariffs since Nigeria “imports very significant quantities”, adding that volatility would continue due to the US’ actions.

He, however, said the company expects to see more stability in major economic indicators like inflation and interest rates.

“I’m speaking to this because this will add a next chapter to the persisting uncertainties that are not part of the slide,” Essaadi said.

“In the slide, we are talking about seeing some stability in Nigeria, so without what’s happening on the planet [and] what is happening in the US with a change of president.

“When you just zoom in to Nigeria, we do see dimension. CBN and the currency which is more stable, inflation, and the way it’s calculated is up for a bit of discussion, but looks to be a bit better, [and] interest rates that will potentially follow leading to more stability in Nigeria.

“That was the outlook, still is the outlook. I guess we’ve seen in the first few months of the year some continuation from a very strong quarter four, but also now in the month of March that we just concluded, we start to see again, impact of cost of living.

“So, affordability, that again, really kicking in proper. So, it is very hard to make predictions. The one thing we can say without redoing our strategy is that Nigerian Breweries has a true and a real right to win.”

Essaadi said “the painful steps” taken in 2024 have set a strong foundation to ensure the company can continue to make a profit.

NIGERIAN BREWERIES REAFFIRMS COMMITMENT TO SUSTAINABILITY

But despite the uncertainty, which the managing director said is still being faced, the brewer reaffirmed its commitment to sustainability through initiatives hinged on three key pillars: environment, social and responsible.

Sade Morgan, corporate affairs director, said the company would continue to raise the bar in sustainability to drive its ‘Brew a Better World’ (BaBw) agenda through innovations and collaborations that will protect and preserve the environment, support local communities, and ensure responsible alcohol use.

“Sustainability remains at the heart of our business. We continue to raise the bar on our Brew a Better World agenda, focusing on three pillars of climate action, accelerating the social sustainability agenda through community impact, and addressing the harmful use of alcohol,” she said.

The director said the organisation is committed to achieving its carbon neutrality goal across its production facilities by adopting green and renewable energy sources, maximising the circularity of the products, and giving input and output materials a second life.

According to Morgan, the company has invested about N2.5 billion in decarbonising its footprints, achieved 98 percent of its zero-waste-to-landfill target, and planted 283,904 trees at the Olokomeji forest reserve, to restore a healthy watershed.

She added that all seven of the company’s operational breweries are equipped with functional wastewater treatment plants.