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Five Years Consecutive Losses That Cage IB Plc’s Dream 

 Tales of a   serial profit loser brewer achieving higher revenue numbers on the back of vastly increasing cost of sales

             The move by   Anheuser-Busch InBev,  a  beer giant  and the world’s largest brewer,  to conquer  the Nigeria’s   brewery industry and displace the two  incumbent players of Nigerian Brewery and Guinness  is ,indeed ,   smacked of   a long term planned  agenda  .The new owner of IB Plc did  not hide its ambition  . Displaying  the  fire in its  belly   , one of  its former  Managing Directors ,  Mr. Hugo Dias Rocha  restated  this   more clearly    as IB Plc’s   corporate strategic intent last year  : “Our dream of achieving market leadership of the beer industry in Nigeria remains unshaken as we are confident in our abilities and commitment as a team.”   . This declaration, no doubt, sent jitters down the spines of the incumbent market leaders in the industry  as well .

 IB Plc had acquired SAB Miller Nigeria, former owner of International Breweries, Pabod Breweries and Intafact Breweries  in 2016 ;   later ,it  adopted  International Breweries Plc , its current corporate name  purposely for that .The  takeover ,   no doubt , casts   for the then  IB  Limited    as it was called before  its takeover  a shadow bigger than its former  size. Observers and analysts, intimidated by the initiative ,  believed  the move   might   signal  the end of the decades of dominance of the brewery industry   by  the two incumbent players  mentioned above .

 However , few years after the takeover ,IBPlc has remained a dog barking but cannot bite ; since then ,International Breweries has remained a lame duck    and  its shareholders ,  observers and analysts of the company thoroughly disenchanted    .  

 Although its  intent is on challenging the industry status quo but  IB Plc has remained more a rule-taker than  a rule-maker within its industry  with more efforts focused  on catching up with competitors  and  less  percentage   of its effort have been  on  advantage-building ; its competitors “headlights” ,no doubt , remain shining farther out than its , its rivals  more influential in setting the new rules of competition within its industry ,  regularly defining new ways of doing business, building new capabilities, and setting new standards of customer satisfaction than it . IB Plc is just at the treadmill delivering threshold values to its shareholders in terms of returns on their investments .

 The case  of  IB Plc may not be far seek.  The company is yet to overcome the task of regenerating core strategies    while it is battling with  the task of re engineering core processes  .   From its operations , it is evidently clear that the company  is currently   under a  serious competitive pressure .   Consequently,   the fear instilled by its arrival to Nigeria brewery industry   and its ambitious declaration   has disappeared due to its failure   to translate its dream to realty .   

Even its future   picture is equally   increasingly gloomy   for  the company is   now known to be  a mere serial losers ;  it has turned  itself to  an albatross for its shareholders   ,creating more fears  than dreams on their  faces  .                  .

 Perhaps, due to the restlessness of its owners, the company has removed or redeployed  about  four CEOs  within a space of  five years . At the Annual General Meeting of the Company which was held on 30 May, 2018, shareholders ratified and approved the appointment  of  a new  Managing Director, Annabelle Degroot  to replace the first ceo  appointed in 2017   . In January 2020 Hugo  Dias  Rocha replaced  Annabelle Degroot  who left as the end of 2019  as Managing Director  while  Carlos Coutino  , the current  CEO  came in  2022  as its new managing director following the resignation of Hugo Rocha.


The company’s  financial figures tell the  agony of the new owners of the company better  . The company’s latest results  came to  a loss of  N2.3 billion  in the first quarters of 2023   . From profit & loss figures, International Breweries announced N218.65 billion revenue in 2022 from N182.3 billion in 2021 but the beer maker witnessed 29 per cent per cent increase in its cost of sales and N10.68billion finance cost in 2022 from N4.8billion in 2021.   However , its  2022  FY Audited Financial Statement, revealed  a loss before tax of N26.84billion as against N19.84billion loss before tax in 2021   and   loss after tax of Loss for the year   of   N21.6 b   as against  a loss of  N17.66 billion in 2021 .  

  Before this , the brewer  had  declared bottom line loss for three consecutive years since 2018, posting a loss of N3.93 billion. In 2019, the loss declared spiraled by an overwhelming 607% to N27.79 billion ;  its loss ,however ,declined  in 2020 to N16.08 billion.

  Ironically , the company grew its revenue by 20% between 2021 and 2022  and  over 51%  between 2019 and 2021  on the back of inflationary pressures driven by increases in prices of goods and services over the years.  This implication is clear :  this   giant brewer is making money but finds it difficult to translate to net income or bottom line .

 In the  2021  financial year, the glitters  of hope surfaced in the first quarter . International Breweries Plc in its first quarter ended March 31, 2022 reported stronger growth in revenue backed by consumer demand for its brands to migrate into impressive earnings and positioned itself  to deliver  enhanced profits in 2022 financial year. The volume growth that drove revenue by 48 per cent in the first quarter of 2022    was ahead of industry expectations  and contributed to the company’s migration from loss to positive results in the  first quarter of 2022  . The unaudited first quarter, 2022 financial result and accounts of International Breweries showed N57.52 billion  revenue  from N38.96 billion reported in Q1 2021. 

 But this hope dramatically fizzled out in the second  and third quarters signaling another doom in 2022 .Although ,  International Breweries Plc ,makers of “Hero” Lager ,  reported a Profit After Tax of N336.20m  for the half year period ended 30 June, 2022, a 102.2% upward push from the N13.88bn loss it reported for the same period in 2021,it was on the strength of the first quarter result .This is because in three months ,between April and June , it  recorded  another loss of  N384.97m . This loss ,however , could not be covered again in the third quarter; its loss for the period for that period was N3.15b and for the nine months was N2.81b in 2022 as against N2.22b   in 2021 respectively .

   Its shareholders have been at the receiving end of the above miserable scenario with neither dividend nor any appreciable capital gain  and they are thoroughly disenchanted  .


 Is this not a misadventure for the new owner of IB Plc ? That is the question yet unanswered.  The miserable financial position of IB Plc has  continued to generate mixed reactions.  What is the problem with the International Breweries? is its  resources  inadequate or   the     resource deployment  capability of  its leadership failed   to generate adequate competencies   or its  strategies and product values  failed to live up to  its critical success factors  ?

    For    the management of IB Plc , the above  uninspiring  performances over its five years  operations  could simply be traced  or attributed to institutional factors.  Late last year  ,perhaps  getting jittery over another disastrous performance on the horizon  , the  top management  in a recent  press release titled   : “International Breweries Reports  Third Quarter and Nine Months 2022 Results’’ , while  trying   hard  to defend itself  and assuage its disenchanted  stakeholders attributed another loss in  the third quarter 2022  results  to the prevailing macro-economic headwinds.   

   The company blamed the challenging quarter on the  industry contraction and supply chain constraints  as the single-digit top-line growth  recorded by it was knocked out  by elevated cost pressures.“Following a strong first half of the year, our volumes declined in the third quarter of 2022 due to a soft industry and ongoing supply chain constraints. The last three months have been characterized by elevated inflationary pressure which has had an impact on consumer disposable income. The period experienced especially severe weather with a longer rainy season and floods in key markets.”

 The company   blamed the decline in its  gross profit and margins  on elevated costs largely due to higher energy prices, FX illiquidity, commodity costs headwinds, severe weather, and overall inflationary pressures.    

  Surprisingly , Rocha, its former CEO  ,  however ,  still put up some spirited efforts , to commend the management led by him. “Despite the difficult third  quarter, we remain focused on our winning commercial strategy. Year-to-date, our brands remain resilient and continue to deliver Net Revenue growth. We remain committed to returning to profitability and creating value for our stakeholders consist.”  .  

“We remained resilient during the period led by our core brands, premium portfolio and innovation. As part of our “Beyond Beer” strategy, we launched Flying Fish during the quarter to address incremental occasions and consumer needs. This has been well received and continues to gain acceptance in the market ” ,its CEO further noted .

 He   explained  that   the company’s   top-line  which grew by mid-single single digits (5.6%)   was driven by the  revenue management initiatives put in place by the company .    According to him ,the company’s  EBITDA    ,which  was  positive, was driven on the back of prudent resource allocation and cost management .  “We remain positive on the industry’s outlook and remain confident   in the future growth of our business and will continue to invest and strengthen our brand portfolio across all segments.”    

 His  explanations on the company’s  less inspiring financial health position  may not be farfetched  to .  Monetary and fiscal policy, exchange and inflation rates , trade and industrial policy and other macro economic factors are ,indeed , critical to the fortune or misfortune of any corporate entity ;  external environment creates both opportunities and threats which consequently influence strategic development. No doubt , the current inclement environment  is setting up entrepreneurship for  failure than ever in Nigeria ; it is now survival of the fittest among the players in this industry .

    However , the problems of  IB Plc  captured by its  former  CEO are not  limited  to those above ;definitely , it is disingenuous to restrict the poor financial health of IBPlc  to the macroeconomic  headwinds  mentioned above . In the last few  financial years , though the competitive space in the brewing industry was paved with macroeconomic  obstacles,  intense competition  that is setting up the industry for failure is another critical factor  and this is the  major headache for IB Plc .

Increased competition  driven and worsened  by the   fall in consumers purchasing power  remains  the critical challenge  confronting beverage companies currently  .This is because  breweries are playing in a market where consumers have a lower purchasing power and are looking to affordability, consequently ,    the   risk to these companies is the shrinking market .The only way out is to cut prices  .Another challenge is that price cannot be cut forever, thus productivity improvements to reduce costs will be the differentiator. Sequel to this , it is now the survival of the fittest .   

But the above scenario is not unnatural .  Every operating environment of any corporate entity is usually paved with diverse threats and opportunities .  While these  define the  strategic position of every player differently , what define each player’s survival and success remains its ability to respond to the competing pressures and the changes in the business environment .

  No doubt ,  Anheuser-Busch InBev,  the new owner of IB Plc ,   has been boxed to a tight corner. Although ,immense opportunity in the  brewery sub sector of Nigerian economy was the rationale behind  its  acquisition of the above mentioned  three brewers , both the macroeconomic headwinds and tough competition from the market have continued to  frustrate  its  goal  which  is to displace and gain leadership  by  giving   the incumbent leaders including Guinness Nigeria Plc and Nigerian Breweries    . Consequently ,  it has not been easy for it   as its rivals which   had dominated the industry for decades, have  continued to do the same .  

Despite  a good fight from IB Plc , both   Guinness and Nigerian Breweries remain a hard nut for IB Plc to break . The issue is that  the new owner  of IB Plc seemed to have underrated  the both the forces from both the  external  and industry environment  relative to its strategic capabilities .

 Before its arrival ,    Nigerian Breweries was leading the market with about 65% market share while Guinness Nigeria follows with about 25%. They both enjoyed  economies of scale and had   good return on their investment ; the industry produces 22 brands of lager and 4 brands of stout besides other non-alcoholic drinks, Nigerian Breweries dominated  the market in the larger (Star) segment while Guinness had to itself the  stout (Guinness) segment .The industry is at the maturity stage of its life cycle  ,though  still remains one of the  thriving industries  in the Nigerian manufacturing sector.    

 However ,   IB Plc is  not  the  only player experiencing the tough time from the environmental forces  ,its rivals are equally  feeling the heat  from both the external and internal environments  .   But the only disturbing issue is the consistent failure of IB Plc to make profit for its owner and its entire shareholders .


 What is IB Plc doing to realize its dream ?  ; is the prospect of gaining industry leadership, the strategic intent of IB Plc   not gloomy ?  These are the questions waiting for answers        Despite its tales of woes  as captured above , IB Plc still  remains  unrelenting . After all ,every environment is littered with opportunities and  threats ,  and   the fortune or misfortune  of every organization  is a function of its strategic capability as well as its strategic directions and methods employed .

   A detailed analysis of  this company’s responses to the competing  pressures and dynamic environmental challenges  remain the decisive factors dictating  its fate in the last few years and might do the same in the near future .

 For its   survival and success  IBPlc  is deploying every  relevant weapon in its arsenal to  respond to the above competing pressures  brought about by the changing business environment  . What, however,  determines its fate is how its  strategic capabilities  could combat  the challenges of its strategic position  .  To effectively compete,  every company needs to adjust  its internal strengths to the environmental opportunities .So, managers need to identify, combine, re-combine, and manage their resources, competencies and capability to explore their potential and perform better than the competitors on the customer needs, preferences  ,and desires satisfaction.

 The above  is because  the advantage of an organization consists in identification  of the  internal core competences, mainly based on knowledge assets and intellectual capital, that align with the key success factors of the market  that ultimately gives  it competitive advantage, better performance and better market position.

       The leadership of IB Plc has been striving and plotting the company’s long term direction and scope ,configuring its resources  within a dynamic environment to achieve advantage for the company and to fulfill its stakeholders expectations .

  No doubt ,IB Plc has been proactive in its efforts to live up to the above expectations . A  look at the book of IB Plc shows its   management  is  exploring   every opportunity  within and around the industry just  as it is  tackling   certain threats stated above . To gain advantages for the company , the management  has been busy  configuring  its resources  within the changing environment  to fulfill the stakeholders expectations  with its   strategic directions and methods  targeted at  achieving   strategic intent of capturing the industry leadership ;  it is competing  more on the basis of cost rather than differentiation  to gain  competitive advantage possible ; the company is equally    being more flexible and fleet-of-foot .

  By producing   low cost beer for a segment of the market  that  could not afford the premium brands of the existing market ,this strategy  is expected  at gaining  large or disproportionate portion  of the market share   . This is one of the two strategies usually employed by corporate players to compete in the market and  to outperform their competitors .  .    

   Another option  engaged by IB Plc   as   its strategic direction   is wide number of   products and markets  . International Breweries Plc is a brewery in Nigeria which brews, packages and markets a range of beer and non-alcoholic malt beverages. The company is known for its beer sold under the Trophy brand name and non-alcoholic malt drink sold under the Betamalt brand name, namely Trophy Lager, Trophy Black and Betamalt malt drink. Other brands packaged and marketed by International Breweries Plc include Castle Milk Stout, Castle Lager, Redds, Hero, Grand Malt and Voltic Water.    This option indicates   a much broader scope and very diversified in terms of both products   and markets  , creating  new products     and entering  new territories to   gain large  part of the market share. .   

     Its broader scope and very diversified orientations  are driven by its financial resource advantage  enabled by its acquisition of the three  brewers in the three  key beer drinking geopolitical zones in Nigeria  . IB Plc has been embarking   on product developments and gaining   better market penetration considered to be strategic enough to give it cost advantage via economic of scale and risk reduction .    It  deployed Trophy lager beer , Hero lager , Life Continental Lager Beer and Tiger lager beer ,trophy stout   and  positioned them to achieve this goal .  Analysts believe  ,products like Trophy , Hero ,Lite , Trophy Stout ,Eagle  and Budwasher  from  its  stable   have better tendency to be competitive in that segment of the market with price advantage .

  To achieve the same goal , IB Plc has been  constantly innovating to survive  by adding new   brands   and values  to its  existing  brands . This is being helped by its resolve to listen to customers while developing new products and services ; it is equally deploying more funds to its businesses to boost its capability  while at the same time building relevant external relationship .

 Each of these choices is  either pursued independently by organic development, by acquisitions or by strategic alliances with  the parent company .

 From the above analysis we can  see IB Plc strategic choices, or options, potentially available to it for responding to the positioning issues. Three overarching choices  are possible and these include how at a business level  it  positions itself in relation to competitors or  how it competes  in the market of its choice  on the basis of cost or differentiation ; its  strategic direction  on  which products and markets to pursue which is on much broader in scope  and  very diversified in terms of both products  ,markets  and new products  ; and finally,   about methods by which to pursue  the strategies which is by  organic development, by acquisitions and  by strategic alliances with its parent company .   

However , while the above choices are conventional , what matters most is how  far it could achieve its strategic intent .    Since strategic choices relate back to analysis of strategic position  , they are expected to take into consideration  and address the issues of the macro  environment , forces at work in the industry and sector, resources and capabilities, stakeholder expectations to  achieve the company’s strategic  goals.


  By the calculations of the management of IBPlc , its strategic choices are delivering its corporate objectives . Alluding to the positive impact of those initiatives     , the company    attributed   its   resilience to  its  core brands, premium portfolio and innovation . As part of its “Beyond Beer” strategy, the company said it  had  launched Flying Fish during third  quarter  of 2022 to address incremental occasions and consumer needs. And the management  claimed this had been well received and continued  to gain acceptance in the market.

  The management position , no doubt ,  is difficult to believe .   Though   its management gave kudos to its strategic  initiatives ,the potency  of  the above strategic choices  in tackling the challenges of  the company’s strategic position has  remained    and left much to be desired   . Despite the claim by the company on the positive impact of its  strategic initiatives on its  survival, the fact that  it  has consistently been making losses in the last five years has been raising questions on success of its strategic choices, at least from the shareholders point of view.   The strategic choices  employed to achieve its strategic intent could not allow it to outperform its competitors but to survive .    


 Ordinarily , to know whether  a strategy succeeds  or fails to deliver , answers to three questions  resting  on  criteria of a successful strategy   are usually  employed to unravel these  riddles    .  First, does  the  strategy address the key opportunities and threats the organization faces   ?    Since choices have to be made in the context of an organization’s  strategic position and  strategic choices  are what are  potentially available to an organization for responding to the positioning issues , it is apposite for the above    IB Plc strategic choices to fit its strategic position to achieve its strategic intent .

 Two ,does the   strategy meet the expectations or the return acceptable? And finally ,  does the company  able to execute the strategic plan effectively in terms of resources, skills, timing, market changes, access to finance and more ?

  Evaluating IB Plc strategic choices shows they  might   fit well the opportunities and threats in the environment.   Its  move to stay in the low  segment ,no doubt , is in line with  the conventional wisdom of strategic fit  considering its strategic position relative to its rivals . Though   there is competition   between  its  two major  rivals ,  since there are no price wars  between  its major competitors   as their  products are differentiated and there are  insignificant  price differences  , the only avenue for IB Plc  to gain this advantage over their brands   is to come up with substitutes at  lower prices and gain better   market  share and revenues .

  Beyond this , since  both Nigerian Breweries and Guinness have  products that particularly valued by certain groups and  look somehow very robust  ,to    gain entry into those markets and product segments , International Breweries must gain cost leadership too  ,sell at lower prices and deliver    products of  strong  quality  that another  customers  group would prefer at its prices  and product features that are in line with their expectations  

   But  if a company’s achieves a strategic fit by identifying opportunities in a business environment and adapting resources and competences  to take advantage of these opportunities , and yet it fails to deliver a competitive value for money , then something is wrong somewhere . This   indicates  its strategic choices  have failed   to exploit  its targeted opportunities  due to the prevailing  environmental threats ; even though it achieved strategic fit

 . This is confirmed  by its consistent losses , a status from which    it is  not likely to escape very soon without  any dramatic improvement.  In a nutshell ,the key message from the above is that a company might achieve strategic fit and yet fail t deliver competitive value for money  as in the case of IB Plc in the last few years . 

 In this case , it is either  its resources are not  unique or adequate  or the  resources are not properly deployed  to generate relevant and appropriate competences for competitive advantage  that  are expected to drive  its strategic intent of industry leadership.  It could also be  that its resources are  unique or adequate  but not properly deployed  to generate relevant and appropriate competences for competitive advantage  

   The question remains , what drives International Breweries’ miserable performances in the past few years or what is wrong despite its supposedly strategic fit  ?   Is t resources not unique enough or not effectively deployed ?

A detailed analysis of IB Plc resource base, particularly  its financial  assets , indicates it is highly competitive .  AB InBev’s  since  the acquisition of the three brewers  ,no doubt ,   had  beefed  up its financial power   to gain entry and  achieve disproportionate   share of the market  dominated by both Guinness and Nigerian Breweries , it is not resourceful enough . 

After the acquisition ,  out of the three major brewers in Nigeria , Guinness ,Nigeria Plc  has the least financial  asset base ; its total assets as at September ,2022 stand at N220.40b while its total equity was N92.93b ; Nigerian Breweries’ total assets amounted to N556.22 against total equity of N184.42b ; International Breweries ,by assets and equity ,follows Nigerian Breweries with total assets of N414.97 b and N13580b respectively .

  With this volume of its financial and physical   resources relative its competitors  ,IB Plc is expected  to gain better market share and profitability than Guinness Plc . Though ,other factors are responsible for this ,yet  this  view may not be misplaced . No doubt, a company’s size could give some advantages to a corporate entity ,at least from economic of scale point of view .  This is because  having a capacity to match the resources and global distribution of large competitors brings advantages . First , large companies also tend to devote a disproportionate share of their resources to training , advertising and education.  Also , it opens the door to many of tomorrow’s mega-opportunities  as this requires  significant resources.    

    .   .

 However , this has not been the case .  IB Plc’s asset size  gives a contrary result  . For instance , in the third quarter  of 2022 ,despite those advantages , the huge asset base of IB Plc has failed to tilt the industry structure to its advantage in terms of market share  ,and this is the first proof that something is wrong somewhere .   According to our findings, Nigerian Breweries still remains the largest Brewer in Nigeria by market share  holding on to 54% of the total revenues of N221.239 billion reported by the three largest brewers  in the third quarter of 2022 ;it has held on to the number one spot as indicated by the tracking data since 2013.

Guinness Nigeria Plc ,however , retained its number two position at the end of September 2022 with a market share of 24% of the total revenue  while  International Breweries despite its enormous resource advantage over Guinness Plc , has failed to justify this in term of market share; it trailed the two with a market share of 22.2% of total revenue  . The point is that if  its financial, intellectual and physical assets are adequate or competitive  , they  may not be delivered the  expected value for money, if not adequately deployed . This is the case of IB Plc .

  The   uninspiring performance of  IB Plc is not limited to its  weaker asset turnover  relative to its rivals. Other value creation capabilities related to   how the company  deploys its resources or strategic  capability which are aimed at  gaining  competitive  advantage  relative to its rivals confirm  its inability to deliver competitive value for money  in the past few years . 

  This    manifests vividly in its operations as it  positions IB Plc as inefficient company . This   is confirmed by its relatively  skyrocketing  cost of sales and finance cost compared to its rivals  since  the new owner  took over the  company  .

The negative implications of this are  palpable and heavy  . Its inability to attain the status of cost leadership  which is  imperative for  delivering  its strategy of  low price brands  put its strategic intent of gaining industry leadership status in disarray .

The reason for this may not be  misplaced  . Customers do just value product features at any price because  price is also an important product features . Sequel to this, an organization must be competent   at managing cost , otherwise , it will not be able to meet the customer price expectation  and ,or generate sufficient profit  and survive financially in the long run . This is a challenge that has become a hard nut for it to break and a key drawback  to its profitability .

 A look into its book ,for instance shows , though   IB Plc has maintained a positive outlook  or modest growth in its revenue in the last few years  ,  it is achieving higher revenue numbers on the back of vastly increasing cost of sales. This again reflects in a negative EPS of-0.47 for IB Plc. This indicates it is willing to incur huge marketing costs to capture market share.    This is evident in its  relatively excessive  cost of sales and finance costs  .    


  To sell these liquids of pleasure is not always easy for bottlers and brewers as is the case for all manufacturers. The trend is that the cost for that as represented by the cost of sales on the profit and loss account never goes down. The only direction it travels is northwards. During the period, the cost of sales was valued at N38 billion, a 17 percent high from the N33 billion in the same period last year . However , while IB Plc posted positive revenue  in 2020 and 2021 and continued this  in 2022 financial years ,the company has been achieving these  higher revenue  numbers on the back of vastly increasing cost of sales .   In 2022 financial year ,to achieve N100 revenue , it cost it N80 ,in 2020  , N78; in 2021 , it was  N75  .This is reflected in its consistent negative EPS    . This indicates IB Plc is willing to incur huge marketing costs to capture market share . 


Another angle that shed  some lights  on the company’s performance in the period under review as in the last few years is its   financing  income relative to its to its financing  costs ,a reflection of its  capital mix  between the debt,  which requires interest payments,  and equity   .In the period  under review there is every indication that the company is highly leveraged . This is where the company  received the most cataclysmic  misfortune .  A  look at IB Plc  Equity multiplier , a leverage ratio that measures the portion of the company’s assets that are financed by equity confirmed this as much .  Its  high  equity multiplier indicates that a significant portion of  its   assets were  financed by debt . As at September 2022, with a total assets of   N414.97b   and  its total equity of N135.80 as against  its total assets  of N469. 95b and equity of N 135.30b   in  the corresponding period of 2021, leading to IB Plc equity multiplier of 3.06 in the third quarter of 2022 and debt to assets or debt ratio is 0.67 or 67 %,indicating it  financed  67% of  the assets by debt .     

 This funding  strategic direction was highly disastrous . Although the positive performance from the finance income or interest received from the company’s prudent investments in the financial market    was up by  108 % to N5.17b from   N3.00b  , however , this was  too feeble  to cage the finance cost that hit  N10. 68b in  ,2022  from  N4.80b   in  2021  . Ultimately, with heavy finance cost which jumped by  122.5 %  this resulted in  a net finance costs  of  N5.51 b  as against  net finance cost of  N1.79b  in   ,2021 .   Consequently this messed up the company  and led to a tragedy that hit the pretax profit   .

   The equity multiplier posed a high risk to its creditors.  Although  the company is confident of its impressive cash flow history , this not notwithstanding  , the  company  incurred  high debt service charges  this depreciated it   heavily within the period under review .  Sequel to this,  its   Net cash inflow from operating activities was down to N20.16 b from N40.61b   as  its Cash and cash equivalents  at the end of the period  nosedived heavily to N24.85b from N82.38b     

 To attain a cost efficient status a corporate  player  is expected to understand the knowledge and competences associated  with the cost drivers including the economies of scale ,supply costs ,product design or processes design and experience curve. IB Plc is ether not exploiting these opportunities efficiently or lack the capability to do so .   

 Apart from the fact that  competitive  cost management  which is indicated   by  cost efficiency that is imperative to deliver better value for money , if an organization is to be profitable ,   an ability to operate effectively , meeting customers product features requirements at a given cost is equally a critical success factor   ; in other words , the success of an organization  also depends   on how well it is able to provide  product features that are valued at a given price .  In addition to being a cost inefficient company  ,  IB Plc  is equally not delivering its product features effectively or at  a cost that will give it  products  leadership over its rivals   in the segment targeted by it ; it fails to emerge a clear leader in the segment of its choice unlike both Guinness and Nigerian Breweries in the premium segment. 

Though the company could be said to deliver values or product features  that meet    threshold level ,that are  essential for it to survive ,  however , in terms  of those product features to outperform competitors, intense competition from the substitutes coming from the former Consolidated Brewery acquired by Nigerian Breweries has continued to hinder its strategic intent of exploiting lower price advantage of the segment  in which it  operating  .  

 In a nutshell , a herculean task  for IB Plc is the fact that its strategic direction of operating in the segment of low price beer  consumers  is countered by the intense competition from its rivals particularly the Nigerian Breweries with products like Goldberg and 33 .   .   

  Moreover ,while intense competition from other brands  operating in the same market segment   it  targeted  is  giving it  tough time , the  dilemma confronting it   is  that the company is equally  finding  difficult to penetrate premium segment  . segment. 

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