International Breweries Stages Remarkable Turnaround with 39.5% Revenue Surge

International Breweries Plc (INTBREW) has delivered a stunning financial turnaround in its second quarter results, posting earnings per share of N0.07 compared to a loss of N1.76 in the same period last year.

The dramatic recovery caps off a remarkable first half performance that saw the company generate N0.25 earnings per share versus losses of N3.98 in H1-24.

The brewing giant’s revival story centres on explosive revenue growth of 39.5% year-over-year in Q2-25, building on an even stronger 52.8% expansion in the first half.

This topline surge reflects the company’s successful execution of strategic pricing initiatives, enhanced distribution networks, innovative product launches, and comprehensive brand repositioning efforts across its portfolio.

“This represents one of the most significant corporate turnarounds in the Nigerian beverage sector,” noted Cordros financial analysts reviewing the results.

The company’s gross margin expanded by a remarkable 888 basis points to 37.0%, demonstrating the effectiveness of cost management strategies and reduced exposure to foreign exchange volatility.

From Losses to Double-Digit Margins

Perhaps most impressive was INTBREW’s operational transformation. The company posted positive EBIT and EBITDA margins of 14.7% and 24.3% respectively in Q2-25, a stark contrast to the negative margins recorded in the prior year period.

This improvement stemmed from stronger gross profits, dramatically reduced foreign exchange losses (down 22.9 times year-over-year), and a more efficient cost structure that saw operating expenses fall to 19.0% of sales.

The company’s strategic shift to compressed natural gas (CNG) for operations and logistics played a crucial role in driving down energy and distribution costs, contributing to the improved operational efficiency.

Financial Engineering Pays Off

INTBREW’s financial performance was further boosted by a remarkable swing in its finance position.

The company recorded net finance income of N1.94 billion in Q2-25, compared to net finance costs of N21.91 billion in the previous year. This turnaround was driven by a 116.5% increase in finance income alongside a 91.8% reduction in finance costs.

The cumulative effect translated to a profit before tax of N26.46 billion for the quarter, reversing the N61.81 billion pre-tax loss from Q2-24.

After accounting for taxes at an effective rate of 55.0%, the company delivered a final profit after tax of N11.91 billion, compared to losses of N47.32 billion in the prior year.

Challenges Remain

Despite the impressive turnaround, some caution flags emerged in the quarterly performance. Revenue declined 3.6% on a sequential quarter-over-quarter basis, suggesting volume pressures and market normalization following aggressive price increases.

This indicates that while pricing strategies have driven profitability, consumer price sensitivity may limit future pricing flexibility.

Industry observers believe that INTBREW’s continued success will depend on maintaining margin recovery through disciplined cost management while gradually rebuilding volume growth as consumer purchasing power adjusts to the new price points.

The company’s localisation efforts, which helped contain raw material cost pressures to 16.6% year-over-year growth (compared to 96.5% in Q2-24), position it well for sustained margin improvement in an environment where foreign exchange volatility remains a key risk factor for Nigerian manufacturers.

With estimates under review following this strong performance, INTBREW appears to have successfully navigated one of the most challenging operating environments in recent memory, emerging as a more efficient and profitable organization.