…Taxation Hits N215bn, Absorbs 28.4% Of Combined Earnings
Seven major fast-moving consumer goods (FMCG) companies listed on the Nigerian Exchange Group (NGX) recorded a combined income tax expense of N214.76bn in the first half of 2026, representing a 56.2 per cent increase from the N137.48bn charged in the corresponding period of 2025.
The companies covered in the analysis are Nigerian Breweries Plc, BUA Foods Plc, Nestlé Nigeria Plc, International Breweries Plc, Guinness Nigeria Plc, Unilever Nigeria Plc and NASCON Allied Industries Plc.
The sharp increase in tax charges came as the companies generally reported stronger pre-tax earnings, although the higher tax burden moderated the growth in their combined bottom line.
It is important to note that the figures represent income tax expenses recognised in the companies’ financial statements, rather than necessarily the cash taxes paid during the period.
Nigerian Breweries recorded the largest tax charge among the companies at N63.37bn, up 44.6 per cent from N43.83bn a year earlier.
Nestlé Nigeria followed with N61.99bn, representing a 63.9 per cent increase from N37.82bn.
International Breweries posted the fastest growth in tax expense, with its charge rising 80.2 per cent to N36.47bn, compared with N20.24bn in H1 2025.
Guinness Nigeria’s tax expense increased 78.1 per cent to N13.03bn, while Unilever Nigeria recorded a 57.8 per cent increase to N7.18bn.
BUA Foods’ tax charge rose 41 per cent to N22.61bn, while NASCON’s increased 31.5 per cent to N10.10bn.
The increase in tax expense was particularly significant when measured against the companies’ aggregate pre-tax earnings.
Their combined profit before tax rose from N618.59bn in H1 2025 to N756.55bn in H1 2026, representing a 22.3 per cent increase.
However, the much faster growth in tax charges meant that taxation absorbed a larger share of earnings before tax.
The combined tax charge represented approximately 28.4 per cent of pre-tax profit in H1 2026, compared with 22.2 per cent in the previous year.
This indicates that although the companies collectively generated an additional N137.97bn in pre-tax earnings, about N77.28bn of the increase in tax expense was recorded during the period.
Consequently, the growth in aggregate profit after tax was considerably weaker than the increase in pre-tax earnings.
Combined profit after tax increased by 12.6 per cent to N541.79bn, from N481.30bn in H1 2025.
In effect, the companies converted a 22.3 per cent increase in pre-tax profit into only a 12.6 per cent increase in net profit.
The company-level figures also show how the higher tax burden affected earnings differently across the sector.
International Breweries, despite recording an 80.2 per cent increase in tax expense, saw its profit after tax decline 7.2 per cent to N38.31bn, from N41.29bn.
This indicates that the stronger tax charge, alongside other expenses, contributed to pressure on its bottom line.
Nigerian Breweries increased its tax expense by 44.6 per cent, but its profit after tax grew only 5.1 per cent to N92.95bn, showing that tax absorbed part of the improvement in pre-tax earnings.
For BUA Foods, tax expense increased 41 per cent to N22.61bn, while profit after tax rose 12.4 per cent to N292.27bn.
The company nevertheless remained the largest profit generator among the seven companies.
Nestlé Nigeria recorded a 63.9 per cent increase in tax expense to N61.99bn, while its profit after tax climbed 28.1 per cent to N64.78bn.
Guinness Nigeria delivered one of the stronger bottom-line improvements, with profit after tax rising 53.3 per cent to N25.30bn, despite a 78.1 per cent increase in its tax charge.
NASCON also recorded stronger earnings, with profit after tax increasing 25.7 per cent to N19.60bn, while its tax expense rose 31.5 per cent.
Unilever Nigeria was the other company where higher taxation coincided with a weaker bottom line.
Its income tax expense climbed 57.8 per cent to N7.18bn, while profit after tax declined 3.1 per cent to N8.58bn.
The figures underline the changing earnings dynamics in Nigeria’s consumer goods sector, where revenue growth and improved operating performance are increasingly being accompanied by higher statutory tax charges.
The sector’s overall earnings performance nevertheless remained positive, with the combined pre-tax profit of the seven companies rising by more than one-fifth.
However, the 56.2 per cent increase in tax expense, more than twice the rate of pre-tax profit growth, significantly diluted the improvement that ultimately reached shareholders.
The analysis also highlights a widening distinction between operating performance and shareholder returns.
While aggregate earnings before tax expanded by N137.97bn year-on-year, only N60.49bn was added to the combined profit after tax, reinforcing the impact of taxation and other below-operating-line costs on the final earnings available to investors.
The broader FMCG sector has continued to face a challenging operating environment, although improved pricing, stronger revenues and cost-management measures have supported earnings recovery across several listed companies.
