• YTD net sales down 17.9% to NGN69.6bn (US$349.5m)
  • Net profits in the nine months to the end of March drop 83% to NGN864m
  • Operating profits fall 66% to NGN3.6bn
Guinness Nigeria has been hit by economic issues in the market

Guinness Nigeria has been hit by economic issues in the market

Diageo-controlled Guinness Nigeria has reported a slump in year-to-date sales and profits as the country's economy continues to slow.

In its results for the nine months to the end of March, filed on the Nigerian Stock Exchange last week, the company, which is 54.3%-owned by Diageo, saw net sales slide by 17.9% while net profits plunged by 83% to NGN864m (US$4.3m). CEO Peter Ndegwa said losses were driven by the third quarter, without giving specific numbers for the period.

"Third-quarter sales were impacted by a tough operating environment and the lapping of a very strong quarter in the previous year – particularly with distribution gains for the Orijin brand," he said. "The economic slowdown and rise in inflation continue to cause a shift towards lower-margin value products."

The downturn has affected several drinks companies in the market. Earlier this year, Heineken said it was keeping an eye on Nigeria as currency turmoil was making it harder for the company to get money out of the country. However, SABMiller said in its full-year results, posted earlier this month, that its sales in the country leapt by 31% on a 27% lift in volumes.

Looking forward, Ndegwa said: "We are starting to make progress in the broadening of our portfolio and also seeing resilience in our core brands. We are also focused on driving efficiency throughout our operations to address the continuing pressure on margins. We anticipate that the year will be challenging as we incur one-off costs to reshape our business and continue to broaden our portfolio in order to drive future growth."

To read the company's official statement, click here.