NIGERIA: Guinness sales dip but Diageo still shines
Guinness Nigeria sales and profits up
Diageo's Guinness Nigeria subsidiary has reported a strong rise in sales for its fiscal full-year, despite lower demand for the firm's flagship Guinness beer.
Net sales for the unit rose by around 22% for the 12 months to the end of June, to NGN109.36bn (US$708m), Guinness Nigeria said in a stock exchange filing yesterday (23 September). Net profits for the year reached NGN13.7bn, compared to NGN13.5bn a year earlier.
The sharp rise in sales came in spite of lower demand for the Guinness brand.
Diageo raised its prices for Guinness in its key African markets, including Nigeria, during the year, making the brand 75% more expensive than mainstream lager. As a result, Guinness volume sales in the period fell by 6% and net sales by 1% in Africa compared to the previous 12 months. Consumers, particularly those in Nigeria, Ghana and Cameroon, switched to lower-priced beers.
One beneficiary in Nigeria was Harp lager. "Harp performed strongly as distribution gains and increased media activity led to excellent net sales growth for the brand," said Diageo in a report on African beer operations in its full-year results statement, released last month.
Diageo added that it gained share of the Nigerian beer sector during the year.
Diageo's results last week spelt out one strong message, as far as M&A nut Richard Woodard is concerned. Let's watch him clap his hands and jump up and down as he tells us what he heard....
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