Event

Guinness Nigeria Plc (“the Group”) navigated a challenging operating environment in the 2024 fiscal year, as intensifying inflationary headwinds shrunk consumer purchasing power. Specifically, the Headline Inflation which stood at 24.08% at the start of the Group’s 2024 fiscal year (July 2023), surged to 34.19% by the end of the fiscal year (June 2024), exerting downward pressure on volume sales and escalating input costs. Concurrently, Naira depreciation inflicted further losses, ultimately leading to a sustained net loss position for the Group.

Outlook

For FY 2025, we adopt a cautious stance about the likelihood of a shift to net profit, as the Group continues to grapple with intense industry competition, currency volatility, and elevated input and operating costs, which will counterbalance the anticipated revenue growth. We forecast a 20% revenue growth to N359.89 billion, driven by higher pricing and sustained premiumisation, however, we expect margins to remain pressured. On FX loss, we anticipate a substantial reduction, underpinned by our expectation of reduced Naira volatility in the 2025 fiscal year.

Our fair value for the stock is now N69.99 (previous: N67.82). At the current price of N63.50, we retain our HOLD recommendation for the stock, with a total return of 10%.

Please follow the link “Guinness Nigeria Plc FY 2024 – Macroeconomic Challenges Bite Deep, but Growth Prospects Remain in Sight” to view the whole report.

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