Top manufacturing companies incur N1.96trn debt in 2025

By Yinka Kolawole

Analysis of the audited 2025 full-year financial statements of top ten Fast-Moving Consumer Goods, FMCG, companies in Nigeria has revealed that the firms incurred a combined debt burden of about N1.963 trillion, underscoring the mounting pressure facing operators in the consumer goods sector amid soaring inflation, rising interest rates and foreign exchange volatility.

The analysis showed that while some companies aggressively reduced borrowings and strengthened liquidity positions, others remained heavily leveraged as they relied on debt to sustain operations, finance expansion and manage rising production costs.

Dangote Sugar Refinery Plc emerged as the most indebted FMCG company in 2025 with total borrowings of N725.31 billion, representing a 1.09 per cent increase from N717.51 billion recorded in 2024. The company’s net debt stood at N672.73 billion, while its debt ratio of 0.75 indicated that a significant portion of its assets was financed through borrowings. Analysts noted that the company’s high leverage exposes it to elevated financing costs in the current high-interest-rate environment.

Closely following was Nestlé Nigeria Plc, which posted total debt of N476.04 billion despite reducing borrowings by 27.18 per cent from N653.70 billion in 2024. However, the company’s weakened equity base pushed its debt-to-equity ratio to an alarming 65.64 times, highlighting concerns over its capital structure and solvency risks should earnings weaken further.

BUA Foods Plc ranked third with debt of N469.38 billion, although the company maintained a stronger liquidity position supported by a sizeable cash reserve, leaving net debt at N189 billion.

Further analysis showed that PZ Cussons Nigeria Plc reduced its debt profile by nearly 20 per cent to N71.27 billion. However, the company’s negative equity position of N17.34 billion reflected lingering balance sheet stress.

Similarly, Nigerian Breweries Plc recorded one of the sector’s strongest deleveraging efforts, slashing debt by 64.68 per cent to N59.71 billion from N169.05 billion in 2024. The brewer also ended the year with a net cash position of N1.43 billion, signalling improved liquidity and stronger financial resilience.

Mid-tier operators also witnessed varying debt trends. Champion Breweries Plc recorded a sharp rise in borrowings to N59.03 billion from negligible levels in the previous year, indicating a significant shift in its capital structure. Guinness Nigeria Plc increased debt by 9.43 per cent to N43.92 billion amid sustained operating pressures.

On the other hand, Honeywell Flour Mills Plc maintained a stable debt profile at N26.97 billion, while Cadbury Nigeria Plc cut debt by 30.49 per cent to N22.81 billion as part of efforts to deleverage its balance sheet.

At the lower end of the debt spectrum, Vitafoam Nigeria Plc posted debt of N9.30 billion, down 33.5 per cent year-on-year. The company also maintained strong liquidity with cash holdings of N9.02 billion, leaving net debt at just N286 million.

Meanwhile, some consumer goods firms ended the year in stronger liquidity positions with more cash than debt. These include International Breweries Plc with net cash of N155.24 billion, Unilever Nigeria Plc at N108.58 billion, and NASCON Allied Industries Plc with N41.57 billion.

Industry analysts attributed the divergent debt profiles to worsening macroeconomic conditions, including persistent inflation, naira depreciation and rising borrowing costs, which significantly increased operating expenses and the cost of imported raw materials.  

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