Nestle, Dangote, MTN, Cadbury, and several others suffered from the significant weakening of the Naira, leading to the losses recorded. It has been noted that dominant companies in Nigeria have reported losses of an excess of N1.7 trillion due to naira depreciation and forex instability.
According to Dangote Group’s financial report for 2024, the group incurred losses of N164billion. Although this was a considerable sum, the company stated that this was primarily due to its foreign operations in the United States.
Additionally, the group BUA incurred losses of about N69 billion. This is a percentage increase of 1,254% compared to their 2022 losses, estimated to be N5.5billion.
BUA group reported that this was incurred due to the volatility of the exchange market and the subsequent effect on the company’s transactions, especially foreign transactions.
They also admitted to buying foreign currencies when low in value to assuage debts incurred using the same currencies to pay for them.
Further down the line, breweries group Nigerian Breweries recorded a loss of N153 billion in their 2023 audited report, an 83% increase from the N26.3 billion incurred the previous year.
In addition, Nestle Group saw a loss of N198 billion due to currency fluctuations in the foreign exchange market.
Lastly, Cadbury recorded a loss of N36.93 billion due to forex-related issues. These seven companies were used to represent a larger economy, as the businesses in the economy did not soiree from the harsh realities of Naira’s instability.
This is magnified for companies with sizeable foreign exposure, especially those importing materials or resources into the country.
The situation with the local currency was also amplified amplified when the Central Bank floated the currency so it would find itsit’s actual value.
