Companies’ dividends on shaky ground as devaluation bites

Some of Nigeria’s biggest listed firms have recorded significant foreign exchange losses in the first half of 2023, a development that is posing threats to their ability to pay dividends for the 2023 financial year.

BusinessDay findings showed that Nigerian stocks, which rallied following the implementation of major reforms by President Bola Tinubu, may be dampened by FX losses due to the naira devaluation.

For instance, Guinness Nigeria Plc incurred N49 billion in exchange rate losses in its unique full-year 2023 report. The exchange rate depreciation led the company to a loss of N18.1 billion, its biggest full-year loss since 2020 when Covid-19 ravaged company financials.