Macro headwinds impeding growth Nigerian brewers have had a challenging H1 2016 (end-June).
Although we estimate that the sector’s unit volume grew by mid-single digits y/y over this period, most of the growth was driven by the value segment. For the mainstream category, beer consumption contracted in response to macro headwinds, including the persistent depreciation of the naira and inflationary pressures. The resulting squeeze on household wallets ultimately led to consumers down-trading to cheaper products and a re-categorisation of the beer market. Given a volume price mix tilting towards value brands, Guinness Nigeria, International Breweries and Nigerian Breweries reported average sales growth of 5% y/y in the January to June period.
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