International Breweries pre-tax profit rises 21.86% to N90.44bn despite tax hit

International Breweries Plc recorded a 21.86% increase in pre-tax profit to N90.44 billion for the nine months ended September 2026. A sharp rise in income tax expenses cut profit after tax by 5.74% to N54.51 billion.

The unaudited nine-month 2026 results were filed with the Nigerian Exchange (NGX) on Monday, October 26, 2026. Revenue rose marginally by 2.12% to N482.61 billion from N472.57 billion in the same period of 2025. Earnings per share fell to 32 kobo from 34 kobo.

Cost savings lift gross profit

Cost of sales declined by 8.02% to N286.67 billion. Gross profit rose by 21.76% to N195.94 billion, and gross margin improved to 40.61% from 34.05%. Materials consumed and allocated overheads dropped by 14.35% to N222.83 billion. Realised foreign exchange losses narrowed by approximately 36% to N8.63 billion. Operating profit increased by 20.66% to N80.86 billion. Administrative, marketing and distribution expenses rose by 26.13% to N116.16 billion, with advertising, promotion and distribution costs up by 36.68%.

Tax expense jumps 119.25%

Net finance income increased by approximately 33% to N9.58 billion. Finance income of N19.63 billion exceeded finance costs of N10.05 billion. Income tax expense surged by 119.25% to N35.93 billion from N16.39 billion. In the first half of 2026, pre-tax profit rose by 21.55% while profit after tax declined by 7.21%. Third-quarter pre-tax profit stood at approximately N15.65 billion, compared with N12.71 billion in the corresponding quarter of 2025.

Cash generated from operations rose to N121.10 billion from N38.42 billion. Net operating cash flow reached N114.43 billion. Capital expenditure stood at N85.13 billion, broadly in line with the previous year. The company reported no outstanding bank loans or overdrafts as of September 30, 2026.

N84bn capital return cuts cash

Cash and cash equivalents declined by 33.27% to N103.74 billion as of September 2026, from N155.45 billion at the end of December 2025. The fall followed financing outflows, including an N84 billion return of capital to shareholders. Net financing cash outflows reached N99.71 billion. The qualification deadline for the capital return was September 16, 2026, with payment scheduled for September 23. Total shareholders’ equity declined by 5.90% to N470.33 billion. At the half-year, the company held N171.08 billion in cash and equivalents, including N115.80 billion in short-term investments.

Ownership disclosures showed AB InBev Nigeria Holdings BV’s reported stake rising to 96.01% from 78.44%. Brauhaase International Management GmbH’s stake fell to 1.41% from 8.85%. Reported share counts were unchanged and combined substantial holdings remained at 97.42%, suggesting reclassification rather than additional share purchases. Accumulated losses stood at N191.03 billion at the end of 2025. A proposed share capital reduction aims to restore distributable reserves and support the ability to resume ordinary dividend payments.

Share price falls after results

International Breweries’ share price declined by approximately 2.76% to N8.80 on Monday, October 26, from N9.05 on Friday, October 23, after the results. The stock has lost approximately 37.14% from N14 at the beginning of 2026, a decline of N5.20 per share. The shares have also declined by approximately 9% since September 24.

The results show improving operating margins, stronger cash generation and no bank debt, against relatively flat revenue, rising selling expenses and a higher tax burden. Fourth-quarter tax expense and progress on the proposed capital reduction will determine whether improved pre-tax profitability translates into better earnings per share and dividend capacity.