Beer makers in Africa’s largest consumer market are swimming in profits, helped by a stable naira and more local sourcing of raw materials after years of counting FX-induced losses that have battered their bottom lines.
Profit at International Breweries, Nigerian Breweries, and Champion Breweries soared by 168.6 percent to N131.8 billion in the first six months of 2025, reversing the N192.35 billion losses incurred in the same period last year.
Brewers and other consumer goods firms alike are riding on a relative stability of the naira that has endured multiple shocks before its now rare calmness in the last six months.
The naira has been largely stable and remained unwavering even in the face of global crises that saw emerging market currencies weaken against the dollar. Naira has been within 1500/1550 per `dollar bandwidth, boosting earnings of businesses exposed to foreign exchange.
Also supporting the sector’s growth is a decelerating inflationary trend that slowed to its lowest in almost two years, to 22.2 percent in June. These improving macros have helped taper cost growth.
Beyond the reduced volatility in the market that’s helped shore up bottom-line growth, Uchenna Uzo, a professor of marketing at Lagos Business School, said brewers are “increasingly sourcing their materials locally to mitigate the impact of FX-related losses.”
“The macroeconomic fundamentals have been a bit better for businesses, and this has helped a lot of the brewers in their planning,” Uzo, who doubles as a faculty director at LBS, said.
“This has shown in better sales results, and so these sales results are not necessarily coming from higher consumption, but because the beer makers have come to manage their portfolios better, and they’ve also come to understand how to manage price increases.”,
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Nigerian Breweries’ profit rises to its highest on record
Nigerian Breweries Plc posted its highest profit on record, powered by a less volatile currency and a moderating inflation that’s helped offset the brewer’s steepest loss recorded last year.
Net profit at Nigeria’s biggest brewer rose to N88.4 billion in the first half of 2025, reversing an N85.2 billion loss a year earlier as it rode a sharp jump in sales and slashed finance costs after retiring its foreign currency debt.
Revenue surged 54 percent year-on-year to N738.1 billion, buoyed by stronger commercial execution, strategic pricing, and improved operational efficiency, the company said in a statement to the Nigerian Exchange on Tuesday.
Operating profit soared nearly threefold to N151.9 billion, while net finance expenses fell 87 percent, from N154.5 billion to N19.7 billion, following the repayment of its FX liabilities using proceeds from a recent rights issue.
The performance marks a strong rebound from the losses sustained in 2024, which were largely driven by massive FX translation losses and a challenging macroeconomic environment.
The profit run began in the first quarter of this year, with analysts seeing the improving fundamentals, including the continued rally of the naira and disinflationary trend, boosting the brewer’s net income.
“The performance in the first half of the year was driven by sustained innovation, strong commercial execution, optimising the right pricing strategies amidst rising input costs,” the company said in a separate statement on the NGX.
“Although the macroeconomic environment was reasonably stable, it was still characterised by high inflation and constrained disposable income.”
CardinalStone analysts expect the brewer to declare a N165.5 billion profit after tax in full-year 2025, a material recovery from the N144.9 billion loss reported last year and the N106.3 billion posted in 2023.
The Lagos-based consultancy sees the company’s recovery set in the last quarter of 2024 and “accelerated” in the first quarter of this year to boost profit to a “multi-year high” and increase revenue.
“This strong recovery, which appears to have set in Q4’24 and accelerated in Q1’25, looks set to ride stronger-than-expected volume recovery amid favourable prices and tamer cost pressures,” the analysts said. “We have a FY’25 revenue projection of N1.5 trillion, which is supported by strong volume growth projections and moderate price increases.”
International Breweries returns to profit after two-year losses
International Breweries returned to profitability in the first half of 2025 after enduring two years of steep losses that had eroded earnings.
Net income rose to N41.2 billion in the six months to June 2025 compared with N106.78 billion in losses recorded in the corresponding period last year. That translates to the highest profit in about six years.
The profitability streak that began in Q1 has extended to the second quarter as the brewer saw its net income rise to N11.91 billion, down from a loss of N47.32 billion, supported by reduced foreign exchange pressures that lifted net finance income.
This rebound follows a tumultuous seven-year-long period of full-year losses, even as revenue growth keeps rising.
The brewer’s performance was equally significantly boosted by strong revenue growth, which rose 39.5 percent year on year; a sharp decline in realised FX loss by 22.9x; and higher finance income, which surged 116.5 percent.
“INTBREW’s performance reflects a strong rebound, underpinned by improved operational efficiency, successful brand repositioning, and significantly lower FX-related pressures,” Cordros Research wrote in a note recently.
“The return to profitability also highlights the impact of their strategic shift towards cost optimisation, including energy transition and localisation of inputs.”
Champion Breweries’ profit soars to a record
Champion Breweries’ net income rose to the highest on record, hitting N2.3 billion in the first six months of 2025. This marks an impressive 692 percent year-on-year growth, rebounding from a N386 million loss in the same period of 2024.
Even more striking, the Uyo-based brewer’s half-year profit nearly tripled its full-year net income of N817 million recorded in 2024. Between January and June 2025, the company achieved a gross turnover of N15.9 billion, already accounting for over 76 percent of its total 2024 revenue of N20.9 billion.
A key tailwind for Champion Breweries was the relative stability of the Naira, which helped shield its earnings from foreign exchange losses. These losses had previously been one of the major headwinds dragging performance.
In the second quarter alone, the company posted N7.45 billion in revenue, up 45 percent from the N5.17 billion recorded in Q2 2024. Profit after tax for the quarter stood at N1.3 billion, reflecting a 198 percent year-on-year jump from N437 million.
Champion Breweries’ gross margin climbed to 49.5 percent during the half-year, a notable leap from 39.1 percent in H1 2024. The margin growth reflects both improved pricing and increased sales volume, with inventories rising by nearly N991 million in just six months.
Champion Breweries was the only profitable beer maker in Nigeria last year and was able to pull off consistent growth over the past two years on the back of innovative strategies and operational efficiency, according to Adoga Inalegwu, managing director of the Uyo-based firm, who spoke at an event in Lagos in April.
The company has been adopting a wave of financing innovation models to hedge against foreign currency risks that the sector was heavily exposed to.
Asked the beer maker about the strategy adopted in financing its innovation, Adoga said the company was able to negotiate the pricing of sorghum, a key component of lager beer, at an advantageous rate.
This, according to him, helped the company save over N340 million, a situation that freed up “a whole lot of resources and enabled us to do a lot of innovations.“
”In February of 2024, the price of sorghum was N282 per kilogram. And the moment we saw that as an opportunity, we had to hedge our procurement of sorghum for the rest of the year at that price. Not waiting, not buying in bits, and then falling to the risk of buying sorghum at a higher price later in the year.”
Beyond topline growth, the brewer’s operational efficiency has improved markedly. Its operating margin surged to 24 percent in H1 2025, up from just 6 percent in the same period last year. This 1,800 basis points increase highlights stronger cost control and better capacity utilization.
Having fully repaid all its outstanding loans in 2024, Champion Breweries currently has no bank liabilities. Even while funding working capital internally, the company ended the first half of 2025 with a healthy N4.1 billion in cash. This reinforced its position as one of the more financially stable players in the industry, even though it is smaller than its competitors.
In a bid to expand and deepen market penetration, shareholders at the brewer have approved a fresh capital injection of N45 billion, which will be executed through debt and bonds.
Nigerian brewers could extend their profit run into 2026 as the naira continues its rally. Key levers will be further localisation of inputs, portfolio premiumisation, and tight working capital control.(BusinessDay)
