Nigerian Breweries Plc has expressed commitment to import substitution by investing in local sourcing of raw materials to support the growth and development of Nigeria’s agriculture sector.
The Managing Director/Chief Executive Officer, Mr Hans Essaadi, gave the assurance on Wednesday in Lagos at the company’s 2023 pre-Annual General Meeting media parley.
Essaadi said that the company would continue to invest in the development, improvement and commercialisation of its agricultural raw materials.
He said that the company’s collaboration with relevent local and international research institutes had been expanded to further assess and improve the performance and adaptability of selected registered local sorghum varieties.
According to him, the collaboration will help in the development of new sorghum varieties with improved quality for the industry and increased yield for farmers.
“To increase the positive impact of local sourcing of its agricultural raw materials, Nigerian Breweries has also continuously expanded its sorghum sourcing areas to new communities,” he said.
Essaadi disclosed that the company had been working with some institutes on trials for sorghum with higher yield varieties in northern Nigeria.
He said that the outcome of the trials was beneficial to farmers, adding that it would be made known soon.
Essaadi also said that the company was working with its packaging partners to ensure local sourcing of raw materials.
On outlook for 2023, he said that the first quarter of 2023 was difficult due to foreign exchange scarcity, cash scarcity, high inflation rate and insecurity, among other challenges.
“We are not the only business that experienced the difficulties.
“We moved from forex scarcity to money scarcity. This is a fragmented market, and what that means is that there are thousands of small outlets that operate with just cash, and it is a known fact Nigeria is an informal economy.
“This has been very tough for us. The good thing is that we are coming out of it but I am very cautious.
“Cash is slowly coming back in the economy and we are seeing our numbers improving.
“We had to take a loan consideration which will go through the process of approval including financing cost, our business is under pressure for profitability,” he said.
He said that in spite of the challenges, the fundamentals of the beer market were positive with a good enabling environment.
Essaadi said that the company would remain committed to long-term value creation for shareholders and all its stakeholders.
The Corporate Affairs Director of Nigerian Breweries, Mrs Sade Morgan, said that the company had invested much in renewal energy across its breweries to reduce carbon emissions.
“We kicked off this investment in 2019 and it is a significant investment on renewal energy sources to be able to power our breweries with solar power, hydro power in key investments.
“In addition, we are replacing our machinery and lines with equipment that can run on less energy.
“They are much more efficient and recapturing energy as well throughout the production process.
“When heat is giving up from various machines, we use it to also power other machines,” she said.
Morgan said that Nigerian Breweries and Crossboundary signed a $10 million renewable energy contract (solar and battery storage hybrid) for its Ibadan and Ama breweries in Oyo and Enugu states, respectively.
She said that 14,600 tonnes of carbon emissions would be saved annually from Kakuri, Kudenda, Ibadan and Ama breweries.
She added that the company and Konexa signed a power purchase agreement to provide 100 per cent renewable electricity to two breweries through hydro power.
Source: News Agency of Nigeria