International Breweries Plc recorded a 5.7 percent decline in nine-month profit to N54.51 billion, as higher tax expenses offset stronger operating performance and a significant improvement in gross profit.
The brewer’s profit after tax fell from N57.83 billion in the nine months to September 2025, despite revenue rising 2.1 percent to N482.61 billion from N472.57 billion in the corresponding period of 2025, according to its unaudited financial statements filed for the period ended September 30, 2026.
The results highlight the pressure on the company’s bottom line, with income tax expense rising to N35.93 billion from N16.39 billion a year earlier, an increase of about 119 percent.
Profit before tax, however, rose 21.9 percent to N90.44 billion from N74.21 billion, indicating that the company’s pre-tax earnings improved even as the higher tax charge reduced the amount available to shareholders.
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International Breweries’ gross profit increased 21.8 percent to N195.94 billion from N160.92 billion, supported by a decline in cost of sales to N286.67 billion from N311.64 billion.
Cost of sales fell 8 percent during the period, outpacing the modest growth in revenue and lifting the company’s gross margin to approximately 40.6 percent from 34.1 percent a year earlier.
The improvement suggests that the brewer generated more gross profit from each naira of sales, although rising operating expenses continued to absorb part of those gains.
Administrative, marketing, and distribution expenses increased 26.1 percent to N116.16 billion from ₦92.09 billion in the nine months to September 2025.
The increase reflects higher spending across operating and commercial activities, including advertising, promotion, and distribution expenses, which rose to N75.14 billion from N54.98 billion.
Employee benefit expenses also increased to N22.64 billion from N19.18 billion, while depreciation and amortisation rose to N58.37 billion from N49.04 billion.
Third-quarter revenue strengthens
International Breweries’ performance improved at the revenue and gross profit levels in the third quarter, although profit after tax remained below the previous year’s level.
Revenue for July to September 2026 rose 6.8 percent to N140.54 billion from N131.58 billion in the corresponding period of 2025.
Gross profit increased 38.9 percent to N54.65 billion from ₦39.34 billion, as cost of sales declined to N85.89 billion from N92.23 billion.
The brewer’s gross margin consequently expanded to approximately 38.9 percent from 29.9 percent in the third quarter of 2025.
Profit before tax rose 23.3 percent to N15.65 billion from N12.69 billion, while profit after tax slipped 2.1 percent to N16.19 billion from N16.54 billion.
The difference between pre-tax and post-tax performance reflects a change in the tax line. The company recorded an income tax credit of N543.84 million in the third quarter, compared with a credit of N3.85 billion in the same period last year.
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Operating cash flow more than triples
Beyond its earnings performance, International Breweries generated significantly more cash from operations during the nine-month period.
Cash generated from operations rose to ₦121.10 billion from N38.42 billion in the corresponding period of 2025, while net cash inflow from operating activities increased to N114.43 billion from N34.10 billion.
The improvement provides a stronger cash-generation base for the company as it continues to invest in production capacity and meet its financial obligations.
Capital expenditure on property, plant and equipment stood at N85.13 billion, compared with N86.01 billion a year earlier. The company also disclosed capital commitments of N20.3 billion as of September 30, up from ₦12 billion a year earlier.
Despite the stronger operating cash flow, cash and cash equivalents declined to N103.74 billion at the end of September from N155.45 billion at the end of December 2025.
The reduction coincided with the company’s capital return to shareholders and investment spending during the period.
N84bn capital return reshapes shareholders’ equity
International Breweries completed an ₦84 billion return of capital to shareholders on September 23, 2026, following shareholder approval and the necessary regulatory and court approvals for a capital reorganisation.
The company said the special resolution was approved at its annual general meeting on July 30, 2026, allowing it to use part of its share premium account to eliminate accumulated losses and subsequently return capital to shareholders.
The capital reorganisation eliminated the accumulated losses of N191.03 billion carried at the beginning of 2026, while the subsequent capital return reduced the share premium balance.
As a result, retained earnings stood at N54.51 billion at September 30, compared with accumulated losses of N191.03 billion at the end of 2025.
The share premium account declined to N398.16 billion from N673.19 billion, while total shareholders’ equity fell to N470.33 billion from N499.83 billion at the end of December.
The capital return was distributed to qualifying shareholders on a pro-rata basis, according to the company’s financial statements.
Balance sheet and ownership
International Breweries’ total assets stood at N692.03 billion at September 30, down from N739.74 billion at the end of 2025.
Property, plant and equipment increased to N370.36 billion from ₦339.53 billion, reflecting continued investment in the company’s productive assets.
Current assets declined to N273.63 billion from N314.34 billion, largely due to the reduction in cash and cash equivalents and inventories.
Total liabilities fell to N221.70 billion from N239.92 billion. The company disclosed that it had no outstanding loans or overdrafts at the end of the reporting period, although it continued to carry lease liabilities.
AB InBev Nigeria Holdings BV held a 96.01 percent equity interest in International Breweries at September 30, according to the filing, leaving a free float of 2.55 percent.
The brewer’s earnings per share declined to N0.32 for the nine months, from N0.34 in the corresponding period of 2025.
The company closed its last trading day on Friday at N9.05 per share on the Nigerian Stock Exchange (NGX). International Breweries began the year with a share price of N14.00 but has since lost 35.4 percent of that valuation, ranking it 130th on the NGX in terms of year-to-date performance.
Chinwe Michael is a Nigerian business journalist and media professional with over 4 years of experience covering companies, financial markets, banking, fintech, economic policy, financial inclusion, and corporate affairs. She currently leads the Companies & Markets desk at BusinessDay, where she drives coverage of Nigeria’s corporate and capital markets, translates complex financial data into accessible stories, and mentors younger journalists. Prior to that, she was the head of the financial inclusion/fintech desk. With a background in banking and finance and extensive experience in media and communications, Michael has developed expertise in financial journalism, economic analysis, investigative reporting and market intelligence. Her work examines how monetary policy, corporate performance, capital flows, technology, and regulatory decisions affect businesses, investors, and households. She was selected from about 3,000 applicants as one of 20 journalists for Cohort 4 of the MTN Media Innovation Programme, gaining exposure to new approaches to journalism, technology, and media innovation. Her international journalism experience and engagement with professionals across Russia, Dubai, Saudi Arabia, and others in different sectors have further broadened her understanding of global communication and development.
