NB suspends operations in two plants
Nigerian Breweries
The country’s manufacturing sector has further suffered more setbacks as one of its biggest players, Nigerian Breweries (NB) Plc, has suspended operations in two of its nine breweries.
Speaking via a company statement, the Managing Director/Chief Executive Officer of Nigerian Breweries Plc, Hans Essaadi, described their recent Business Recovery Plan as strategic and vital for business continuity, adding that they are part of a company-wide reorganisation.
The BRP includes a rights issue alongside this re-organisation exercise which includes the suspension of two of its nine breweries and an optimisation of production capacity in the remaining seven breweries.
He regretted that the country’s tough business landscape and harsh operating environment, characterised by double-digit inflation rates, Naira devaluation, forex challenges and diminished consumer spend had taken its toll on many businesses, including theirs.
He say Nigerian Breweries “intend to minimise the impact on the workforce by exploring all feasible alternatives, including relocating and redistributing employees to the remaining seven breweries.”
Support and severance packages will be offered to those that become unavoidably affected. In the statement signed by the company’s Corporate Affairs Director, Sade Morgan, “ this move is essential to improving their operational efficiency, financial stability and enable a return to profitability, in the face of the persistently challenging business environment.”
In letters signed by the company’s Human Resource Director, Grace Omo-Lamai, and addressed to the leadership of the National Union of Food, Beverage and Tobacco Employees (NUFBTE) and the Food Beverage and Tobacco Senior Staff Association (FOBTOB), the company informed both unions that its proposed plan would include operational efficiency measures and a company-wide reorganisation that includes the temporary suspension of operations in two of its nine breweries.
As a result, and in accordance with labour requirements, Nigerian Breweries invited both unions to discussions on the implications of the proposed measures.
The company recalled that recently, it notified the Nigerian Exchange Group (NGX) of its plan to raise capital of up to ₦600 billion by way of a rights issue, as a means of restoring the company’s balance sheet to a healthy position following the net finance expenses of N189 billion recorded in 2023 driven mainly by a forex loss of N153 billion resulting from the Naira’s devaluation.
“We recognise and regret the impact that the suspension of brewery operations in the two affected locations may have on our employees. We remain committed to having a positive impact on our host communities and our consumers; leveraging our strong supply chain footprint; excellent execution of our route to market strategy; and our rich portfolio of brands across the lager, stout, malt, soft drinks, and energy drinks categories; and more recently, wines and spirits with the acquisition of Distell”, Essaadi added.
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