NEWS BITES - AFRICA
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Nigerian Breweries PLC (LG: NB NGN41.0) ranks 23 by earnings yield stocks in the All Shares Index of 97 stocks.
Note: Earnings yield is the inverse of the P/E ratio.
Rank 23 by earnings yield in All Shares Index. Rank 1 is highest.
Last price: NGN41.0;
FY 2022 EPS: NGN1.58;
NIGERIAN BREWERIES (NB) Stock Dashboard [traded in Nigerian Naira, NGN] End-of-Day
| Exchange | NIGERIAN [Nigerian] | Ave Daily Volume | 1,564,531 shares |
| Currency | 1.000 USD = 465.55 Nigerian Naira (NGN) | 52-Week Price Range | 32.00 - 61.65 |
| Jun 07, 2023 | NGN41.0 | Sector | Food/Beverage/Tobacco |
| EPS (FY2022) | NGN1.58 | Market Cap | NGN421 billion [US$905 million] |
| NB P/E | Stock 25.9; Sector 20.9 | Shares Outstanding | 10,280,000,000 |
| NB Dividend Yield % (TTM) | Stock 3.5; Sector 6.2 | NB in Indices | All Shares |
| DPS (past 12 months) | NGN2 | PVNGN1000 (1 yr) PVUS$1000 (1 yr) | NGN709 US$632* |
| EPS Growth (FY2022 vs FY2021) | 0.6% |
*If You Invested $1,000 in Nigerian Breweries a year ago, This is How Much You Would Have Today: $632. USD1000 would have bought NGN415,132 for 6,934.3 shares (@the then price of 59.87) worth NGN709 @41 today. Dividends reinvested are worth $22.
INDEX
SECTION 1 RECENT NEWS AND RESEARCH
SECTION 2 TODAY'S BULLISH SIGNALS
SECTION 3 ONGOING BULLISH PARAMETERS
SECTION 4 TODAY'S BEARISH SIGNALS
SECTION 5 ONGOING BEARISH PARAMETERS
SECTION 6 CORPORATE PROFILE
APPENDIX I DATA & ARCHIVE DOWNLOAD CENTER
APPENDIX II STOCK IDENTIFIERS
GLOSSARY
SECTION 1 RECENT NEWS AND RESEARCH
Financial News
Quarterly Report (Q1/2023):
Release Date: May 22, 2023
Quarterly Report Analysis Q1 2023: Nigerian Breweries reports Loss of NGN10.7b ($23.2m)
Nigerian Breweries (LG:NB) announced loss for the quarter-ended 31 March 2023 [Q1/2023] of NGN10.7b ($23.2m).
Quarterly Report
| March 31 | 2023 | 2022 | 2023 | 2022 | Change |
| Description | NGN m | NGN m | $ m | $ m | (%) |
| Interest | 4,719.7 | 1,158 | 10.2 | 2.8 | Up 307.6 |
| Net Assets | 169,415.9 | 185,976.5 | 366.7 | 447.3 | Down 8.9 |
Bullish Turning Point
Price/Earnings of 25.9 close to historical low
The P/E of 26 is 0.3 times the highest average P/E of 77.5 in the last five years. This is a value criterion, according to Benjamin Graham who described as a value criterion "A P/E ratio down to less than four-tenth of the highest average P/E ratio the stock attained in the most recent five years".
Press Releases and Corporate Wire
March 31: Quarterly Activities Report: Nigerian Breweries Cash Balance decreases 10%
As per a report dated March 31, 2023 the Cash Burn of operating activities was NGN67,866,139,000 in the quarter ended March 31, 2023. This corresponds to an average Cash Burn Rate of NGN22,622,046,333 per month.
| Quarter ended 31 Mar 2023 | NGN |
| Cash and cash equivalents at beginning of period | 22.2 billion |
| Net cash from / (used in) operating activities | (67.9 billion) |
| Net cash from investing activities | (2.4 billion) |
| Net cash from financing activities | 67.9 billion |
| Cash raised (used) during quarter | (2.3 billion) |
| Cash and cash equivalents at end of period | 19.9 billion |
SECTION 2 TODAY'S BULLISH SIGNALS
2.1 PAST WEEK: STRONG MOMENTUM UP - NB strengthens 0.9% propelled by week's volume 1.6 times average
Nigerian Breweries (NB) outperformed the All Shares Index in 3 out of 5 days. The price ranged between a high of NGN41.80 on Friday Jun 02 and a low of NGN40.80 on Monday Jun 05.
| Jun | Nigerian Breweries | Close [NGN] | Change % | RPC % * | Comment |
| Thu 01 | Closes at 12% above VWAP | 40.9 | 0.6 | 0.5 | VI*=1.3 |
| Fri 02 | In 2nd consecutive rise | 41.8 | 2.2 | 2.2 | Week-high of 41.8; Top Rise; VI*=3.8 |
| Mon 05 | Falls 2.4% | 40.8 | -2.4 | -2.4 | Week-low of 40.8; Steepest Fall |
| Tue 06 | Increases on rising relative strength | 41.05 | 0.6 | 0.2 | VI*=1.7 |
| Wed 07 | Decreases | 41 | -0.1 | -0.1 |
* RPC - Relative Price Change is % price change of stock less % change of the All Shares Index.
[Volume Index (VI); 1 is average]
2.2 Rank in the top 8% by Relative Valuation in the Nigerian market
| Description | Value | Rank |
| EV/EBITDA | 21.1 | In Top 8% |
2.3 Uptrend
Beta > 1 combined with price rise. The Beta of the stock is 1.2.
Price/Moving Average Price of 1.02 and positive MACD:
- The Price/MAP 200 for Nigerian Breweries is 1.02. Being higher than 1 is a bullish indicator. The 200-day MAP has increased to NGN40.32, a second bullish indicator.
- The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 39.9 minus the 26-day EMA of 38.48 is positive, suggesting a bullish signal. Both the 12-day EMA as well as the 26-day EMA are rising, another bullish signal.
- The price to 50-day EMAP ratio is 1.1, a bullish indicator. In the past 50 days this ratio has exceeded 1.1, four times suggesting further upside. The 50-day EMAP has increased to NGN37.99. An increase is another bullish indicator.
Past Month:
- Rises to Falls: In the past month the number of rises outnumbered falls 13:8 or 1.6:1.
Past Quarter:
The Best 3 weeks in the past quarter
The past month witnessed the best 2 weeks in the past quarter. In the past quarter the week beginning Monday May 15 saw the highest weekly rise of 11.8% for a relative price increase of 11.8%. The rise was propped up by volume of 1.8 times average.
| Mon-Fri | Change % | All Shares Index Change % | RPC % | Vol Ind [1 is avg] |
| May 15-19 | 11.8 | 0 | 11.8 | 1.8 |
| May 29-Jun 02 | 8.3 | 5.4 | 2.9 | 3.3 |
| Mar 13-17 | 1.9 | -1.5 | 3.5 | 0.4 |
2.4 Other Bullish Signals
MCap/Total Assets:
- Tobin's Q Ratio, defined as MCap divided by Total Assets, is 0.7. Compared with the rest of the market the stock is undervalued.
SECTION 3 ONGOING BULLISH PARAMETERS
3.1 Rank in the top 13% by Size in the Nigerian market
| Description | Value | Rank |
| Annual Revenue | NGN550.6 billion ($1.2 billion) | In Top 6% |
| Ave daily Turnover | NGN39.2 million ($84,300) | In Top 13% |
| MCap | $905 million | In Top 13% |
3.2 Present Value of NGN1000 Invested in the Past [3 Mo, 3 Yrs]; The Best Periods with PVNGN1000 > 1,068
| PVNGN1,000 | 3 mo ago | 3 yrs ago |
| NB.LG | NGN1,069 | NGN1,157 |
| Food/Beverage/Tobacco sector | NGN1,074 | NGN1,426 |
| All Shares Index | NGN1,075 | NGN2,240 |
3.3 Past quarter: price rise of 4.1%
3-Month price change of 4.1% for Nigerian Breweries outperformed the change of 0.4% in the All Shares Index for a relative price change of 3.7%.
| Price Change % | Quarter |
| Nigerian Breweries | 4.1 |
| Food/Beverage/Tobacco sector | 7.3 |
| All Shares Index | 0.4 |
3.4 Safe Interest Cover
Interest cover of 3.1 is above a safe benchmark figure of 3. However, it has decreased from 3.1 a year ago.
| Years | Interest cover |
| 2022 | 3.06 |
| 2021 | 3.14 |
| 2020 | 1.63 |
| 2019 | 2.93 |
| 2018 | 4.73 |
3.5 Satisfies one criterion of Benjamin Graham
- The P/E of 26 is 0.3 times the highest average P/E of 77.5 in the last five years. This is a value criterion, according to Benjamin Graham who described as a value criterion "A P/E ratio down to less than four-tenth of the highest average P/E ratio the stock attained in the most recent five years".
SECTION 4 TODAY'S BEARISH SIGNALS
Price to Book of 5.5 > Food/Beverage/Tobacco sector (of 12 stocks) average of 4.3:
- The Price to Book of 5.5 indicates overvaluation compared with sector average of 4.3 and 2.4 for the Nigerian Market.
4.1 Rank in the bottom 16% by Relative Valuation in the Nigerian market
| Description | Value | Rank |
| Price/Earnings | 25.9 | In Bottom 16% |
| P/E * P/NTA | 142.72 | In Bottom 5% |
| Price to Book Value | 5.5 | In Bottom 1% |
| Earnings Yield % | 3.9 | In Bottom 1% |
4.2 Rank in the bottom 18% by Price Performance in the Nigerian market
| Description | Value | Rank |
| Rel Strength 6 mo | 19 | In Bottom 18% |
| PV1000 [1 yr] $ | 632 | In Bottom 10% |
4.3 Downtrend
Past Quarter:
- In the last three months the stock has hit a new 52-week low six times, pointing to a downtrend.
Trailing Relative Strength (6 months) at 19 percentile:
- The stock has a 6-month relative strength of 19 in the Nigerian market of 113 stocks indicating it is trailing 81% of the market.
4.4 Other Bearish Signals
- Return on Equity of 7.3% versus sector average of 14.9% and market average of 12.3%.
- Total Liabilities/EBITDA of 17.1 is more than 5, this compares unfavourably with the Joseph Piotroski benchmark of 5.
- Return on Capital Employed of 12.1% versus sector average of 15.0%.
- Net profit margin has averaged 2.5% in the last 3 years. This suggests the company is less profitable with a low margin of safety.
- As per the Du Pont analysis, Return on Equity is less than stellar at 7.3%. This is computed as net profit margin of 2.4% times asset turnover [sales/assets] of 0.89 times leverage factor [total assets/shareholders' equity] of 3.4.Also, this has deteriorated from 7.4% last year.
| ROE (%) | Profit Margin (%) | Asset Turnover | Leverage factor | |
| Current Year | 7.3 | 2.4 | 0.89 | 3.4 |
| Previous Year | 7.4 | 2.9 | 0.9 | 2.8 |
4.5 Overbought/Bearish Signals:
- The Stochastic indicator of 85.0 has broken through the overbought line of 80; this indicates the price is close to its 14-day high and is likely to revert to a downtrend.
SECTION 5 ONGOING BEARISH PARAMETERS
5.1 Rank in the bottom 23% by Performance in the Nigerian market
| Description | Value | Rank |
| EBITDA Margin % | 4.7 | In Bottom 23% |
| Net Profit Margin % | 2.4 | In Bottom 17% |
5.2 Present Value of NGN1000 Invested in the Past Year; The Worst Period with PVNGN1000 < 710
| PVNGN1,000 | 1 yr ago |
| NB.LG | NGN709 |
| Food/Beverage/Tobacco sector | NGN873 |
| All Shares Index | NGN1,052 |
5.3 Past year: price fall of 31.5%
1-Year price change of -31.5% for Nigerian Breweries underperformed the change of 5.5% in the All Shares Index for a relative price change of -37.1%.
| Price Change % | Year |
| Nigerian Breweries | -31.5 |
| Food/Beverage/Tobacco sector | -12.7 |
| All Shares Index | 5.5 |
5.4 Moving Annual Return of -29.1% in the past year:
Moving Annual Return was -29.1% in the past year. Based on a dynamic start date of 5 years ago, the real rate of return has averaged -8.8%. The Moving Annual Return has been negative in 3 out of 5 years.
| NB | Close (NGN) | Dividends (NGN) | Capital Gain / (Loss) % | % Yield | Annual Return % |
| Jun 07 | 41 | 1.43 | (31.5) | 2.4 | (29.1) |
| 1 Yr ago | 59.87 | 1.6 | 7.7 | 2.9 | 10.6 |
| 2 Yrs ago | 55.59 | 0.94 | 43.3 | 2.4 | 45.7 |
| 3 Yrs ago | 38.79 | 2.01 | (26.3) | 3.8 | (22.5) |
| 4 Yrs ago | 52.64 | 2.43 | (51.2) | 2.3 | (48.9) |
Close 5 years ago NGN107.87
5.5 MCap: 5-Year Decrease of NGN505 B [$1B] (54%)
In the past 5 years Market Capitalization has decreased by NGN504.6 billion (54%) from NGN926.1 billion to NGN421.5 billion. Based on a dynamic start date of 5 years ago, there have been declines in MCap in 4 out of 5 years.
| Price | MCap (NGN B) | MCap ($ M) | |
| Last | NGN41.0 | 421.5 | 905.3 |
| 1 Year ago | NGN59.87 | 501 | 1,206.8 |
| 2 Years ago | NGN55.59 | 472.2 | 1,239.6 |
| 3 Years ago | NGN38.79 | 335.9 | 866.9 |
| 4 Years ago | NGN52.64 | 455.8 | 1,268.1 |
| 5 Years ago | NGN107.87 | 926.1 | 2,565.3 |
5.6 Annualised Period-based Total Shareholder Returns [TSR %]: The Worst Periods with TSR < 5%
| TSR % | 1 yr | 3 yrs | 5 yrs | 10 yrs | 20 yrs |
| NB.LG | -29.1 | 4.9 | -14.4 | -11.1 | 3.4 |
5.7 P/E/G > 1
The price earnings ratio of 25.9 divided by trailing twelve months eps growth of 0.6% corresponds to P/E/G of 40.7 times.
| EPS Growth (%) | 0.64 |
| P/E/G | 40.74 |
| P/E | 25.95 |
5.8 Declining Volume, down 31% in 5 years
In the past five years, Average Daily Volume of Trading (ADVT) has decreased 30.6% to 1.6 million shares.
Avg. Daily Volume Traded 12 months ended Jun 07, million shares
| Year | ADVT |
| 2023 | 1.6 |
| 2022 | 2.2 |
| 2021 | 1.8 |
| 2020 | 3.7 |
| 2019 | 2.3 |
5.9 Declining VWAP, down 47% in 5 years
In the past five years Volume Weighted Average Price (VWAP) has decreased by 46.6% to NGN41.31. Based on a dynamic start date of five years ago, there have been declines in VWAP in 3 out of 5 years.
Past five years, 12 months ended Jun 07 (NGN)
| Year | High Price | VWAP | Low Price |
| 2023 | 61.65 | 41.31 | 32.0 |
| 2022 | 75.8 | 47.71 | 37.27 |
| 2021 | 59.31 | 40.78 | 26.78 |
| 2020 | 58.18 | 42.98 | 20.32 |
| 2019 | 109.72 | 77.39 | 52.37 |
5.10 Declining share turnover, down 64% in 5 years
In the past five years, average daily share turnover has decreased 64.0% to NGN61.8 million ($132,804). This suggests decreased liquidity.
Past five years, 12 months ended Jun 07 (NGN million)
| Year | Average Daily Turnover |
| 2023 | 61.8 |
| 2022 | 101.7 |
| 2021 | 72.1 |
| 2020 | 157.9 |
| 2019 | 171.8 |
5.11 Quarterly Trend in Revenue and Net Profit Margin:
- Net Profit margin has been negative in recent quarters. [All figures in %]
| Qtr-ended | Revenue Growth | Net Profit Margin |
| Mar 23 [Q1 vs Q4] | - | -8.7 |
| Dec 22 [Q4 vs Q3] | 31.7 | -1 |
5.12 Satisfies 4 out of 9 criteria of Joseph Piotroski [pass mark 5]:
- Positive net income.
- Positive operating cashflow.
- Good quality of earnings [operating cashflow exceeds net income].
- Improvement in gross margin [from 36.7% to 38.7%].
But does not meet the following 5 criteria of Joseph Piotroski:
- Return on Assets improvement.
- Improvement in long-term debt to total assets.
- Improvement in current ratio.
- Total shares on issue unchanged (or reduction in total shares on issue).
- Improvement in asset turnover.
5.13 Year-over-year (%) Change in Dividend:
Final dividend for FY 2022 was NGN1.03. The year-on-year change was down 14.2% from NGN1.20 in the previous year FY 2021.
| Final | FY 2021 | FY 2022 |
| Dividend (NGN) | 1.2 | 1.03 |
SECTION 6 CORPORATE PROFILE
6.1 Activities
Nigerian Breweries is a Nigeria-based company. It is a subsidiary of Heineken N.V. The Company is engaged in the brewing, marketing and selling of lager, stout, non-alcoholic malt drinks and soft drinks. Its brands include Star, Gulder, Legend, Heineken, Maltina, Amstel Malta and Fayrouz. It is Nigeria's 2nd largest Food/beverage/tobacco company by market capitalisation.
6.2 Contact Details
| Website | http://www.nbplc.com |
| Physical Address | Iganmu House Abebe Village Road Iganmu PO Box 545 Lagos Nigeria |
| Phone | -5801116 |
| Fax | 01-2617682 |
6.3 Industry & Sector [of 15 stocks]
| Classification Level | Name of Sector |
| Business Sector | Food & Beverages |
| Economic Sector | Consumer Non-Cyclicals |
APPENDIX I DATA & ARCHIVE DOWNLOAD CENTER
NB: EXCEL TABLES ARE AVAILABLE TO EXPORT DATA:
+ PRICE VOLUME - 5-YEAR HISTORY
+ FINANCIALS - 10-YEAR HISTORY [INCLUDING Q1/2023]:
+ PEER COMPARISON - STOCK IN FOOD/BEVERAGE/TOBACCO SECTOR AND STOCK IN ALL SHARES INDEX
NB: LINKS IN HTML TO FURTHER INFORMATION:
+ USD vs NGN EXCHANGE RATE CHARTS IN HTML
APPENDIX II STOCK IDENTIFIERS
ISIN: NGNB00000005
PermID: 4295885255
RIC: NB.LG
GLOSSARY
ADVT: Average Daily Volume of shares Traded
Annual Return: Dividends Paid In a 12-Month Period/Price at the Beginning of the Period + Capital Gain or Loss over 1 Year/Price 1 Year Ago (%)
Cash Burn: Net Operating Cashflow used in the past quarter. Shown for companies reporting losses
Current Ratio: Current Assets/Current Liabilities (times)
Dividend Yield: Dividend Per Share/Share Price (%)
EBIT Margin : Earnings Before Interest and Tax/Revenue (%)
Earnings Yield: Earnings Per Share/Share Price (%)
Income during the n years (3/2/1): Dividends received during the Period
Interest Cover: Earnings Before Interest and Tax/Interest (times)
Moving Average Price (n periods): Sum of Prices for each Period/Number of Periods
PV1000: Present value of 1000 invested 1 year/'n' years ago
Price Close/Moving Avg Price: Latest Price/Moving Average Price
Price/Earnings: Share Price/Earnings Per Share (times)
Price/NTA: Closing Share Price/Net Tangible Assets Per Share (times)
Price/Sales: Share Price/Sales Per Share (times)
Relative Price Change [RPC]: Relative price change is price change of stock with respect to Benchmark Index
Relative Strength (6 Months): Price close today/Price close 6 months ago, then ranked by percentile within the entire market.
Return on Assets: Net Profit/Total Assets (%)
Return on Equity (Shareholders' Funds): Net Profit/Net Assets (%)
TSR: Total Shareholder Returns is expressed as an annualized rate of return for shareholders after allowing for capital appreciation and dividend
TTM: Trailing 12 Months
Volume Index (VI): Number of shares traded in the period/Average number of shares traded for the period
Volume Weighted Average Price (VWAP): The Volume Weighted Average Price (VWAP) is the summation of turnover divided by total volume in the same period.
Disclaimer: While this document is based on information sources which are considered reliable, it has been prepared without consideration of your specific investment objectives, financial situation or needs, so you should carry out your own analysis or seek professional investment advice before an investment decision is made. The document contains unbiased, independent equities data and analysis from Jupiter International (Australia) Pty Ltd trading as BuySellSignals (AFS Licence 222756), who provide round the clock analysis on every stock, every sector, every market, every day. BuySellSignals is not a broker, and does not have executing, corporate advisory or investment banking functions. Jupiter International (Australia) Pty Ltd, its directors, employees and contractors do not represent, warrant or guarantee, expressly or impliedly, that the information contained in this document is complete or accurate.
Data for the BuySellSignals algorithms is drawn from annual reports, company websites and similar sources of publicly available data. It should be used as a guide only.
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