International Breweries Plc, Nigeria’s second-largest beer maker, has announced its return to profitability, posting a N50.9 billion profit after tax for the 2025 financial year. This achievement signifies the company's first annual profit since 2017, offering significant relief to its majority owner, AB InBev.
The company's audited financial report revealed a substantial swing from a net loss of N113.6 billion in the prior year to a profit of N50.9 billion in 2025. This turnaround was driven by an appreciable leap in revenue to N619 billion and a drastic reduction in net foreign exchange loss to N13.7 billion from N165.7 billion.
International Breweries, known for brands like Budweiser, Trophy, Hero, and Castle Lite, holds N739.7 billion in assets. Its share price saw a positive reaction, increasing by 9.9 per cent to N13.35 on the Nigerian Exchange (NGX) after the results were made public.
Financial Turnaround and Strategic Consolidation
The journey to profitability for International Breweries has been challenging. AB InBev consolidated its position in 2016 by purchasing SAB Miller’s interest, bringing its stake to 72.2 per cent. A subsequent merger with Intafact Beverages Limited and Pabod Breweries in 2017 aimed to leverage economies of scale, targeting Nigeria as a key growth market in Africa.
However, the company began reporting losses in 2018, with negative earnings of N3.9 billion attributed to a surge in finance costs and the harmonization of accounts from the merged entities. The establishment of a greenfield plant, the Gateway plant, at an initial cost of $250 million, further strained its financials, increasing financing costs and debt levels.
Between 2019 and 2020, soaring operating costs and stagnant revenue growth prolonged the period of losses. The post-tax loss peaked at N113 billion in 2024, exacerbated by foreign exchange losses stemming from currency reforms and a dollar crunch.
The key factors enabling the turnaround in 2025 included a significant revenue increase to N619 billion and a sharp decrease in net foreign exchange loss. Nairametrics reported a pre-tax profit of N88.9 billion for 2025, with revenue rising by 26.60% year-on-year to N619.04 billion. Cost of sales increased by 14.48% to N409.40 billion, resulting in a gross profit of N209.64 billion, a 59.60% increase year-on-year.
Navigating Shareholding and Free Float Requirements
AB InBev increased its shareholding to 87.3 per cent in 2020 through a rights issue aimed at reducing the company's debt. Another rights issue in 2024 further deleveraged the balance sheet, with proceeds used to pay down a $379.9 million loan. This increased AB InBev's stake to 96 per cent.
The concentration of ownership has led to a free float of only 4 per cent of the company's issued shares, raising concerns about their availability to potential investors and potentially creating artificial scarcity. The Nigerian Exchange (NGX) requires companies to maintain a free float of 20 per cent or at least N40 billion worth of shares. In January 2025, the NGX extended the deadline for International Breweries to address this shortfall.
Despite these free float concerns, the Nigerian stock market saw a general uptick on April 10, 2026. The NGX All-Share Index rose by 0.30% to 203,770.4, with market capitalization reaching N131.1 trillion. International Breweries was among the top advancers, with its share price gaining 9.88%.
