International Breweries – turning obstacles into a N472 billion comeback

In a brewing landscape that feels like a marathon on a broken road—high inflation, soaring raw‑material costs, and a volatile naira—most players would have settled for survival. International Breweries, however, chose to sprint. The nine‑month results for 2025 tell a story of turning adversity into a spectacular turnaround.

The numbers are striking: revenue vaulted 37.6 % to ₦472.57 billion, up from ₦343.45 billion a year earlier. That kind of growth doesn’t happen by accident; it’s the product of strategic pricing, a premium‑brand push, and a revived consumer appetite for the company’s portfolio under the AB InBev umbrella ¹.

Cost of sales did climb—25.3 % to ₦311.64 billion versus ₦248.58 billion in 2024—but it was a calculated trade‑off. The gross profit surged 69.6 % to ₦160.92 billion, widening the margin to roughly 34 % from 27.6 %. In other words, every naira of sales is now yielding more kobo, a sign that the firm is taming the cost‑of‑goods beast even as input prices bite.

Operating expenses, however, kept pace with ambition. Admin, marketing, and distribution costs rose 26.7 % to ₦92.09 billion, reflecting heavier brand‑building activities—think premium‑product launches, aggressive promotions, and logistics upgrades. Yet the pain was worth it: operating profit swung from a ₦125.4 billion loss in 2024 to a ₦67.01 billion profit in 2025, a swing of over ₦192 billion.

A major swing factor was finance income and cost. Finance income jumped 67.8 % to ₦13.33 billion, while finance costs collapsed 83.5 % to ₦6.13 billion, leaving a net finance gain of ₦7.20 billion compared to a loss of ₦29.15 billion last year. The result? Profit before tax of ₦74.21 billion, flipping from a ₦154.55 billion loss in 2024. After a ₦16.39 billion tax charge, net profit landed at ₦57.83 billion, versus a ₦112.81 billion loss a year ago, delivering an EPS of ₦0.34 (from ‑₦0.67) ¹.

Balance‑sheet resilience adds another layer of confidence. Total assets nudged down slightly to ₦713.19 billion, but current assets still cover current liabilities comfortably (current ratio 1.57 vs 1.32 in 2024). Cash and equivalents fell to ₦87.93 billion, partly due to ₦41.74 billion in investing outflows, yet the cash conversion cycle improved to 102 days from 121 days, showing tighter working‑capital management.

What’s driving this momentum? Analysts point to premiumisation, cost‑efficiency programs, and the absence of heavy impairments that plagued 2024. The company’s focus on higher‑margin brands, coupled with disciplined spending and a leaner finance structure, has re‑positioned it for sustainable growth even as Nigeria’s macro‑environment remains unforgiving.

In short, International Breweries has turned a turbulent market into an opportunity canvas, leveraging volume growth, margin expansion, and smarter financing to deliver a nine‑month profit turnaround of ₦57.83 billion. The outlook suggests the brewer is poised to keep the momentum, banking on festive‑season demand and continued premium‑brand traction to close the year on a high note.

tightening the cash‑cycle screw and betting big on growth

The nine‑month snapshot for International Breweries shows a company that has re‑jigged its cash‑management playbook while simultaneously re‑engineering its debt profile. The result? A cash conversion cycle that plummeted to 102 days from 121 days, a 19‑day swing that most analysts would call a textbook working‑capital win.

Receivables took a modest step back—days receivable edged up from 22 days to 26 days, meaning customers are now taking an extra four days to settle their bills. That slight stretch could have hurt liquidity, but the firm compensated by stretching its payables dramatically. Days payable outstanding jumped from 36 days to 55 days, a 19‑day extension that effectively locks in an extra 19 days of free financing.

Inventory efficiency also nudged forward. Stock now turns over in 131 days versus 135 days a year ago, shaving off four days of warehouse dwell time. The combined effect—shorter inventory days, a modest receivables lag, and a much longer payables window—compressed the cash cycle by 19 days, a move that should, in theory, free up cash for reinvestment.

Yet, the balance sheet tells a more nuanced story. Despite the tighter cash cycle, the current ratio slipped, falling below the prior‑year level. The culprit? A bank overdraft of ₦3.7 billion, a new addition where none existed before, pulling down short‑term liquidity. On the flip side, the company has vanquished its term loans, driving overall financial leverage lower and making the credit profile more attractive to investors.

That’s not all. International Breweries is pouring capital into future capacity. Capital expenditure surged to ₦86 billion for the nine months (versus ₦42.6 billion in the same period last year), and the firm has a ₦12 billion commitment for property, plant and equipment still on the table. This aggressive capex push is aimed at modernising and expanding production lines, positioning the brewer to capture more market share in Nigeria’s growing beer and ready‑to‑drink segments.

The financial results back the optimism. Revenue surged 37.6 % to ₦472.57 billion, while gross profit leapt 69.6 % to ₦160.92 billion, widening margins to roughly 34 %. Net profit swung from a ₦112.81 billion loss last year to a ₦57.83 billion profit, flipping EPS to ₦0.34 from a loss of ₦0.67.

All of this comes on the heels of quality accolades—the kind that reinforce brand equity and justify premium pricing. Though the specific awards aren’t detailed in the current tables, the company’s track record of winning international recognitions (e.g., Monde Selection Gold Awards for its brands) underscores a commitment to excellence that translates into market confidence.

In short, International Breweries is playing a high‑risk, high‑reward game: tightening cash cycles, leveraging supplier credit, shedding costly debt, and betting big on capex to future‑proof its operations. If the macro‑environment stabilises and the new capacity comes online smoothly, the company could turn today’s cash‑flow crunch into tomorrow’s sustainable growth engine. Investors watching the Nigerian Stock Exchange should keep an eye on how quickly the firm converts these operational tweaks into consistent margin expansion and debt‑free cash generation.