AfriPulse
September 29, (THEWILL) — Ten Nigeria’s quoted companies, all in the consumer goods sector, recorded an aggregate of N50.3billion in the first-half of the year (H1 2025) against the massive loss they experienced in the corresponding period of 2024. The turnaround followed the stability of the foreign exchange market after the devaluation of the naira in June 2023, which saw the local currency drop over 70 percent in value.
The positive trend also reflects the sector’s improved currency risk management amid a complex economic environment, government reforms and shifting market dynamics.
Data compiled from the H1 financial statements of the selected firms showed that Dangote Cement, the manufacturing titan, reported an FX gain of N45.74 billion in H1 2025, erasing its N201.3 billion loss in H1 2024. This alone accounts for a significant portion of the sector’s improvement.
Dangote Sugar also demonstrated resilience, posting a N102 million FX gain for Q1 2025, compared to a massive N193.7 billion loss in the entire first half of 2024. Nigerian Breweries similarly improved, recording an FX gain of N1.24 billion, a stark contrast to a N70.9 billion loss the prior year.
A particularly noteworthy contribution came from Nestlé Nigeria, which swung from a devastating ₦263.71 billion loss in H1 2024 to a N3.14 billion gain in H1 2025. Industry experts say the swing illustrates effective FX risk management and strategic operational shifts, signaling the company’s adaptation to volatile currency markets.
Unilever Nigeria and Cadbury Nigeria also posted FX gains of N1.69 billion and N249 million respectively, rounding off a broad-based industry recovery.
Guinness Nigeria Plc recorded a mixed but ultimately stabilising FX position. In H1 2025, the brewer posted an unrealised FX loss of N9.55 billion (down from N41.02 billion in H1 2024) and a realised FX loss of N75.54 billion (slightly higher than N71.27 billion in 2024).
However, these were offset by a surge in unrealised FX gains of N64.07 billion (up from N19.29 billion) and a realised FX gain of N19.71 billion, which was not reported in the prior year. This improvement highlights a more balanced FX exposure despite persistent realised losses.
Champion Breweries Plc, on the other hand, remained under pressure but showed signs of progress. The company reduced its FX loss to N543.7 million in H1 2025 from N910.74 million in H1 2024, narrowing the impact by about N367 million. While still negative, this trend points to gradual stabilization compared to the prior year.
However, not all the consumer goods firms have yet fully benefitted. International Breweries reported a loss of N82.62 billion in 2024 but did not disclose 2025 FX results. Neimeth Pharmaceuticals eliminated its N923.6 million loss from 2024, recording neutral FX exposure in 2025.
At the heart of this sector-wide recovery are several critical drivers, beginning with the Nigerian government’s decisive reforms in the FX market. In June 2023, the Central Bank of Nigeria (CBN) consolidated multiple FX windows into a more unified and transparent exchange rate regime, reducing speculative currency trading and smoothing naira volatility. This provided much-needed predictability for manufacturers dealing with import payments, foreign debt servicing, and international procurement.
Coupled with this, the government’s sustained push to increase local content and promote indigenous supply chains has reduced import dependency for many manufacturers, lessening direct exposure to FX risk.
Many companies have ramped up sourcing of raw materials locally and shifted to local currency financing, protecting themselves from the wild swings in foreign exchange markets seen in prior years.
The improving FX landscape also allowed firms to restructure foreign currency-denominated debt, securing more favorable terms or swapping into local currency obligations, significantly reducing FX losses related to revaluation of borrowings.
Foreign currency-denominated debt refers to loans or financial obligations that a company (or government) borrows in a currency other than its local or functional currency. These financial engineering strategies were key for companies like Nestlé, Dangote Cement, and Unilever.
The CBN had on June 14, 2023, announced the unification of the multiple exchange windows of the forex market. This resulted in significant depreciation of the naira.
Findings from the 10 sampled consumer good firms showed they reported a total of N517.1 billion in non-recovery net foreign exchange losses in H1 2023 – the year of the devaluation of the local currency.
Nestle Nigeria and Dangote Cement were the worst hit with non-recovery net forex losses of N123.7 billion and N113.6 billion respectively in that year. They were followed by Nigerian Breweries N85.26 billion, Dangote Sugar Refinery N83.09 billion and Guinness Nigeria N41.9 billion.
Others were International Breweries with N40.66 billion, Neimeth Pharmaceuticals N22.82 billion, Unilever Nigeria N2.93 billion and Cadbury Nigeria N1.03 billion.
The eroding wave of depreciation resulted in a total post-tax loss of N370.57 billion by the 10 firms, compared to N175.9 post-tax profit they posted in the equivalent period of the preceding year. The development impacted severely on the balance sheets of Nigerian businesses as they had to source extra funds in local currency to meet their dollar-denominated obligations.
The 10 selected firms suffered huge forex losses which impacted severely on their earnings and drained their bottom lines as inflation maintained an upward trend.
“It is a bad omen.” said Barnabas Ikuru, an investment and financial analyst.
“Their balance sheets have been significantly eroded, their earning power vitiated, and their expansion capacity weakened. Top among the victims are the employees who may be laid off, downgraded or suffer a salary cut. Some companies will have to increase the price of their products and that could impact their sales revenue because of declining consumer power,” Ikuru said.
***Written by Ogochukwu Onwaeze.
Author Profile
Sam Diala, THEWILL
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
Source: TheWillNigeria | Read the Full Story…
