E-Malt.com News article: Nigeria: Champion Breweries expresses confidence in federal government’s reforms programmes

Champion Breweries has passed a vote of confidence on the current economic restructuring of the federal government disclosing that it would improve the fortunes of business organisation in the country in the years ahead, AllAfrica reported January 31.

Speaking in Lagos last week, the Chairman of the company, Obong Cyril Nta disclosed that the reforms programmes will bring about the much needed economic growth and create favourable business climates for businesses in the country.

He said, "We are hopeful that the on-going political and economic restructuring programmes by the federal government, would engender continued economic growth, stabilize the polity and usher in more favourable business climate as well open up opportunities and benefit to intensive marketing efforts."

He commended the federal government for the on-going crusade by both the Economic and Financial Crimes Commission (EFCC) and the Independent and Corrupt Practices and Related Offences Commission (ICPC) to enforce discipline and check corrupt practices in the country.

He urged the government to provide stable and uninterrupted power supply, improve infrastructure, particularly roads, and discourage arbitrary hike in prices of petroleum products which is often the main cause of strike and disruption of work.

The company posted a turn over of N1.1 billion in its 2006 financial year, representing 12 per cent increase over last year's figure of N986.7 million.

Nta disclosed that the improvement in its turnover was occasioned by the introduction of two new products, Becks Beer and Champ Malta.

He said, "Despite that fact that the introduction of the two new products into the market accounted for a loss of N422.5 million in our 2006 financial year, it contributed immensely in boosting our turnover. We are optimistic that they will make tremendous impact on our financials in the coming years."

He disclosed that as a follow up to the introduction of the products, it made huge investments in plants and machinery, marketing and advertisements.

"These new products accounted for the 120 per cent increase in selling and distribution expenses from N139.6 in the year 2005 to N312.3 million in 2006. It also accounted for the 107 increase in depreciation charges from N113 million in 2005 to N234 million interest charges. All these contributed to the increase of 335 per cent loss after tax," he explained.

He however noted that the huge investments accounted for the significant capital appreciation of the company as the Net Assets per share of the company increased during the period by 117 per cent per cent from 64 kobo per share in 2005 to 139 kobo per share in 2006.

He said, "We believe that before long, all these current expenditures in marketing, advertisements and fix assets will start translating to both appreciable turnover and favourable profitability." Nta maintained that the company recently won the International Standard Organization (ISO) award, thus, demonstrating the fact that its products were of high and excellent quality and standard.

He expressed optimism that the future of the company would become more enviable and brighter because of its quality products, national spread and the encouraging acceptability by consumers.


01 February, 2008