Guinness Nigeria Plc recently released its Full-Year 2020 results ended June 2021, revealing impressive top and bottom-line growth as the beer company’s Spirits Division contributed N35.29 billion to overall year-on-year revenue.
This was disclosed by the company CEO, Baker Magunda, in an Investors Presentation following the release of its full-year results. Magunda revealed the Spirits divisions, Mainstream and Premium spirits impressively grew by 75% and 121% y-o-y, respectively. The mainstream spirits include Gordons, Baileys, Smirnoff, McDonalds and Orijin spirits. On the other hand, Premium spirits are The Singleton and Black Label.
According to the financial highlight, sales from the Spirits division assisted growth in overall revenue by 22%, representing N35.29 billion, during the period.
The financial highlight revealed that the spirits division has recorded continuous growth in two years, from 2018 to 2020. In 2018, the division’s contribution to revenue was 17%, taking it a notch higher, it contributed 18% growth to revenue in 2019. In 2020, the division contributed 22% to revenue, reflecting a 29.41% increase in the Spirits division contribution to overall revenue in two years.
However, Beer division, the largest contributor to overall revenue declined by 2.63% in two years and contributed 37% to the 2020 FY revenue, representing N59.53 billion. Nigerians have increasingly gravitated towards spirits in recent years an area seen as high margin business for spirit distributors.
In addition, Malts division, the second-largest contributor to the overall revenue, declined in its contribution by 8.11% in two years and contributed 34% to 2020 FY revenue, representing N54.54 billion, while Return on Trading contributed 7% to revenue, representing N11.23 billion. The Malt drinks include Malta Guinness and Smirnoff Ice Malt.
The increase in the contribution of the Spirits Division can clearly be attributed to the increase in the consumption of the brand of alcohol.
The reopening of businesses and laxation of restriction on gatherings could have also contributed to the increased demand for their products, hence, assisting revenue growth.