MTN Nigeria Communications Plc, and four other multinational companies recovered from 2023 & 2024 financial losses, fuelled by foreign exchange revaluation burden to declare N367.4 billion profit before tax in the first quarter (Q1) ended March 31, 2025.
MTN Nigeria Plc, Nestle Nigeria Plc, Nigerian Breweries Plc, Cadbury Nigeria Plc, and International Breweries Plc foreign currency exposure led to a whooping N937.17 billion loss before tax in Q1 2024.
These five multinational companies experienced substantial foreign exchange losses in 2023 & 20024 financial year, primarily due to the Central Bank of Nigeria (CBN) exchange rate liberalisation in June 2023.
The policy by CBN led to a sharp depreciation of the Naira, adversely affecting MTN Nigeria, among others with foreign currency denominational obligations.
The companies have now returned to profitability. Analysis of their Q1 2025 results showed that MTN Nigeria announced N202.65 billion profit before tax, as against a loss before tax of N575.69 billion in Q1 2024, while Nestle Nigeria, the leading Fast-moving consumer goods (FMCGs) company quoted on Nigerian Exchange Limited (NGX) posted N 51.15billion profit before tax in Q1 2025 from a loss before tax of N196.09 billion declared in Q1 2024.
MTN Nigeria noted in a statement that its funding and liquidity position remains solid, supported by a cash balance of N303.7 billion. Foreign currency exposure remains within manageable limits.
“We have largely settled the outstanding US Dollars Letters of Credit (LC) obligations, with only $1.4 million remaining at the end of the quarter. Consequently, approximately 23 per cent (December 2024: 28 per cent) of the total debt is denominated in foreign currency, and the balance in local currency.
“Our debt metrics are healthy and remain well within all our financial covenants, with a net debt-to-EBITDA ratio of 0.5 times and an interest cover ratio of 9 times as at 31 March 2025. These metrics position us well to meet our operational, financial, and investment obligations while maintaining flexibility to navigate the evolving macroeconomic environment,” the telecommunication company said in a statement.
On its part, Cadbury Nigeria declared N8.5 billion profit before tax in Q1 2025 from a loss before tax of N10.46 billion in Q1 2024.
Nigerian Breweries reported N69.99 billion profit before tax in Q1 2025 from a loss before tax of N65.58 billion while International Breweries announced N35.07 billion profit before tax in Q1 2025 from a loss before tax of N89.35 billion.
The Managing Director/CEO, Nigerian Breweries, Mr. Hans Essaadi in a statement noted that the significant improvement in profitability reflects both volume and value growth, as well as the benefits from the business recovery and process optimisation initiatives undertaken in 2024.
Essaadi explained that the strategic initiatives of 2024 including portfolio optimisation, rightsizing of operations, and disciplined working capital management, continue to yield strong results.
He affirmed that the company was firmly on track in executing its turnaround plan of restoring long-term profitability and building a solid foundation for sustainable growth.
Commenting, analysts at Cordros Capital Limited stated that the earnings performance oof Nigerian Breweries underscored combined impact of strong revenue generation, alongside the gains from recovery and process optimisation efforts implemented in 2024.
They stated, “The brewer’s performance was supported by reduced FX liabilities through the proceeds from the 2024 Rights Issue and a stable exchange rate during the period.”
Meanwhile, investment firm CardinalStone Limited said despite the strong top line performance, the company’s cash position weakened during the period.
“This deterioration was driven by negative cash flows from both operating (–N66.1 billion) and investing (–N10.3 billion) activities, which outweighed the N16.8 billion inflow recorded from financing activities,” it said.
