Eight major companies in Nigeria have collectively declared a loss of N918.1 billion as a result of currency revaluation, triggered by a 68.55 percent depreciation in the value of the naira against the US dollar by the end of September 2023.
The Central Bank of Nigeria’s decision to let the market determine the value of the local currency led to a decline from 461/$1 in December 2022 to 777/$1 in September 2023. The devaluation resulted in substantial exchange losses for the following firms: Dangote Sugar Refinery Plc, Dangote Cement Plc, Nestle Nigeria Plc, Nigerian Breweries Plc, Guinness Nigeria Plc, MTN Nigeria Communications Plc, Airtel Africa Plc, MRS Oil Nigeria Plc, and Seplat Energy Plc.
The financial statements of these companies revealed that the revaluation loss was due to the naira’s devaluation from N465/$ at the end of May 2023 to N776.79/$ by September 2023.
Among the notable losses reported:
- Dangote Sugar Refinery recorded a revaluation loss of N90.99 billion.
- Dangote Cement reported a revaluation loss of N99.02 billion.
- Nestle Nigeria declared a revaluation loss of N143.4 billion.
- MRS Oil reported N2.37 billion in revaluation loss.
- Seplat Energy recorded N16.38 billion in revaluation loss.
- Nigerian Breweries declared a revaluation loss of N86.83 billion.
- MTN Nigeria reported a forex loss of N232.8 billion on its net foreign currency liabilities.
- Airtel Africa documented a foreign exchange loss after tax of $317 million (N246.31 billion).
These losses are attributed to the challenges posed by the devaluation of the naira and the limited availability of foreign currency in the local monetary system. The companies also highlighted difficulties in meeting foreign exchange obligations.
Experts suggest that these forex losses were anticipated given the economic challenges faced by businesses in 2023, especially for firms with foreign loans or obligations.
