Despite spending a whooping N17.67 billion on marketing and advertising, the management of International Breweries Plc couldn’t prevent the company from suffering profit loss in 2021.
International Breweries had upped its promotional expenses to drive consumption of its products such as Trophy Lager Beer, Betamalt, Budweiser, Hero Lager and Eagle Lager, having spent N12.65 billion in 2021.
The company’s marketing yielded 1.23% growth in revenue, generating N182.29 billion last year, against the N136.79 billion it recorded in 2020, International Breweries Full Year Audited Financials for 2021 period shows.
However, cost of production consumed a significant share of the turnover for 2021, as the brewer spent N135.99 billion, which is over 90% of its generated revenue for 2020, to produce its products last year – This is 27.9% higher than the N106.31 billion cost of sales for 2020.
The rising expense weighed on the gross profit, which International Breweries reported to be N46.30 billion for last year, although it surpassed the N30.47 billion the company recorded the previous year.
But the jump in gross profit had little impact as International Breweries ended 2021 with N17.65 billion loss for the period, surpassing the N16.08 billion loss recorded during the corresponding period.
This means International Breweries lost almost exactly the amount (N17.67 billion) it spent on marketing between January and December 2021.
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