Champion Breweries 2017 Financial Summary

Legal Form and Principal Activity

The Company was incorporated in Nigeria as a limited liability company on 31 July 1974 and was later converted to a public limited liability company on 1 September 1992. The Company's principal activities continue to be brewing and packaging of Champion Lager Beer and Champ Malta as well as provision of contract brewing services to Nigerian Breweries Plc, a related party within the Heineken group.

Analysis of Shareholding

The Raysun Nigeria Limited       60.5%
Assets Management Nominee     12%
Akwa Ibom State Government    10%

The holdings of Raysun reduced from the previous year to 60.5% in order for the company to achieve its minimum float as required by the Nigerian Stock Exchange. This currently stands at 17.2% but it is still 2.8% short of the regulatory requirements. The Management mentioned in its latest report that they are working to achieve that.

12 Months Report CHAMPION BREWERIES PLC
	2017 N'000	2016 N'000	change	Year End
Revenue	4,777,313	3,864,943	24%	December
Profit before taxation	603,173	637,300	-5%
Profit for the period	517,562	530,389	-2%
Issued Shares (Units)	7,829,496	7,829,496
Basic Earnings Per Shares (Kobo)	7.00	7.00	0%
Last total dividend paid (Kobo)	0.00	0.00

Quarter on Quarter Performance

Revenue                                                                   PAT

N'000                                                                       N'000

Q1: #1,106,476                                                      Q1: #39,582

Q2: #1,184,769                                                      Q2: #46,547

Q3: (#1,261,041)                                                    Q3:(#20,135)

Q4: #3,747,109                                                       Q4: #451,568

As it had been its tradition and generally for the sector the performance of the Q4 did not go unnoticed, in terms of Revenue and Profit After Tax.

Champion breweries  basically focused on the South South Market had carved a niche for itself their. Although Shareholders still need to wait for a long time to actually get value for their investment considering the rate the company in making money. However, the silver lining is that the company since its last rights issue and management turn around had been impressive, still not operating to maximum capacity though.

The company maintained an average  of #1,194,328.25(000) in terms of Revenue and #129,390.5 (000) in terms of PAT in 2017.

A closer look at the result shows that trade and other receivables increased by 394.97% from #252,177(000) in 2016 to #1,248,197 (000) in 2017. This was as a result of trade receivables that increased by 211.67% and amount due from related parties by 1,5788.86%. The Management of the company should look at how this can be checked because this are Funds that could have earn some interest income for the company within the period and improve bottom line.

Administrative expenses remain stable during the period as it was last year .2018 would provide  whole new challenges and opportunities. Therefore, the company must maximize capacity and improve sales in order to remain competitive and wipe out the negative reserve of that now stood at  #8,574,679,000 at the end of the 2017 financial year end. This continue to be wedge in the wheel of dividend payment to shareholders and at this pace it would take a very long time.

However, Champion breweries remain a major player in the Value market of the Lager category, with expertise from Heineken, the future should be bright but not immediately. 

 The Stock closed at #2.85k on Monday, 12th 2018 with only 34,900 units of the stock traded. Let us see what hope it has against a Market dominated by dividend hunters.