November 1, (THEWILL) – Guinness Nigeria Plc’s profit after tax rose 53.1 percent to N40.69 billion in the nine months ended September 2026 from N26.59 billion a year earlier. But cash generated from operating activities fell 16.8 percent to N51.56 billion, while cash and cash equivalents, after overdrafts, moved from a positive N6.45 billion at the start of the year to a negative N1.41 billion at September-end.
Revenue increased 20.4 percent to N403.33 billion from N335.07 billion, and operating profit rose 23.4 percent to N64.98 billion. Profit before tax climbed 55.3 percent to N61.65 billion, helped by lower finance expenses.
Gross profit grew 20.4 percent to N151.38 billion, keeping the gross margin broadly unchanged at 37.5 percent. Marketing and distribution expenses rose 18.4 percent to N62.91 billion, while administrative expenses increased 19.4 percent to N24.12 billion. Operating margin edged up to 16.1 percent from 15.7 percent.
Finance expenses fell 61.9 percent to N5.83 billion from N15.30 billion. Interest on loans and borrowings dropped to N5.61 billion from N14.66 billion. This reduction helped lift profit before tax faster than operating profit: PBT increased by N21.96 billion, compared with a N12.34 billion rise in operating profit.
The cash-flow statement, however, shows that stronger earnings did not translate into higher operating cash. Cash generated from operating activities declined to N51.56 billion from N62.00 billion, despite the increase in profit before tax.
Inventory was a major pressure point. Stock rose 43.3 percent to N65.65 billion at September-end from N45.82 billion in December 2025, tying up an additional N19.83 billion. Finished goods more than doubled to N17.50 billion from N7.16 billion, while raw materials and consumables increased to N33.68 billion from N25.16 billion. Work in progress fell to N2.22 billion from N4.58 billion.
The cash-flow impact reversed the previous year’s position. Inventory movements released N17.58 billion into cash in the first nine months of 2025; in the same period of 2026, inventory absorbed N19.83 billion. That is an adverse year-on-year swing of N37.41 billion.
The additional stock could support future sales, but the statements do not show how quickly it will be sold. Until inventory is converted into sales and customer payments, the funds remain tied up. Changes in receivables, payables, tax and other working-capital items also affected operating cash flow.
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Guinness spent N28.16 billion on property, plant, equipment and intangible assets, leaving about N23.40 billion in operating cash after capital expenditure. Financing activities then recorded a net outflow of N30.60 billion.
The company repaid N90.29 billion in loans and took new borrowings of N83.28 billion, giving net loan repayments of about N7.01 billion. It also paid N19.27 billion in dividends and N4.31 billion in interest. Total loans and borrowings fell to N38.21 billion at September-end from N43.92 billion in December 2025.
Liquidity weakened over the period. Cash and cash equivalents on the balance sheet fell to N1.40 billion from N6.97 billion, while bank overdrafts increased to N2.80 billion from N523.54 million. After overdrafts, the cash-flow statement reported a negative N1.41 billion balance at September-end.
Dividend commitments add to the demands on future cash generation. On October 21, the board declared an additional interim dividend of N7 per share, worth about N15.33 billion and payable on November 13. Together with earlier dividends of N2 and N7 per share, total interim dividends declared for 2026 reached N16 per share, or approximately N35.05 billion.
That is about 86 percent of nine-month profit after tax. However, the full amount had not been paid by September-end: cash dividends paid during the nine months totalled N19.27 billion, and the latest N7 dividend was declared after the reporting date.
Guinness’s earnings recovery is supported by revenue growth, higher operating profit and lower finance expenses. But operating cash declined, inventory absorbed N19.83 billion, and cash net of overdrafts turned negative. The next test is whether the company can sell down its higher stock, improve cash collections, and meet investment and dividend commitments without rebuilding liquidity pressure.
Ogochukwu Onwaeze is a writer specializing in business and economic journalism. At THEWILL News Media, she translates market trends, financial developments, and policy shifts into clear and engaging stories.
