Diageo Nigeria Unable to Refinance Loan on Dollar Shortage

Diageo Plc’s Nigeria unit has said, it is struggling to refinance a foreign-currency mortgage and trim prices following a scarcity of {dollars} in Africa’s largest financial system.
Guinness Nigeria Plc is weighing choices to handle a $23 million debt as a scarcity of liquidity within the native foreign-exchange market has made it troublesome to refinance, Stanley Njoroge, finance and technique director, stated on an investor name in Lagos on Friday.
“We’ll need to refinance it however there isn’t a overseas forex available in the market in the intervening time,” he stated.
The brewer of Guinness Stout is seeking to roll over the mortgage which matures in Might subsequent 12 months, however is but to determine whether or not to maintain it as a greenback debt or convert to a local-currency mortgage. Nigeria’s second largest brewer’s excellent debt rose 16 per cent to !23.2 billion ($60 million) as of June in contrast with a 12 months in the past, whereas finance prices rose 74 per cent to N4.5 billion.
Nigerian firms are struggling to entry the buck after a droop in oil costs lower export earnings, placing strain on the central financial institution’s capability to fulfill greenback obligations to buyers and companies. “International alternate is a giant concern for us,” Njoroge stated.
Guinness Nigeria made a internet lack of N12.6 billion for the total 12 months by June in contrast with a revenue of 5.5 billion naira a 12 months in the past, in response to its submitting on the Nigerian Inventory Trade on Friday. Income dropped by 21 per cent to N104.4 billion.
The corporate will prioritize stout, spirit and malt manufacturers in 2020 and focus much less on lager because it goals to develop the enterprise and cushion the impression of the Covid-19 pandemic on operations, Njoroge stated.
“We don’t have the best worth in lager,” he stated.

Leave a Reply

Your email address will not be published. Required fields are marked *