International Breweries Plc is moving to reset its capital structure after years of accumulated losses, unveiling a restructuring plan designed to eliminate its negative retained earnings, restore its ability to pay dividends and return excess capital to shareholders.
The brewer’s proposed financial restructuring marks a major step in its post-recovery strategy following its return to profitability in 2025. While the company has resumed earnings growth, accumulated losses of N191.03 billion have continued to prevent it from rewarding shareholders through dividend payments under Nigeria’s corporate regulations.
In a corporate disclosure filed with the Nigerian Exchange Limited (NGX), International Breweries said it intends to undertake a share capital reduction in accordance with Section 131 of the Companies and Allied Matters Act (CAMA), 2020 (as amended), subject to shareholder approval, regulatory clearances and confirmation by the Federal High Court.
The restructuring consists of two separate but related transactions aimed at strengthening the brewer’s capital position.
The first involves applying part of the company’s Share Premium Account to eliminate its accumulated retained losses. Although the accounting adjustment will not generate new cash, it will remove the negative retained earnings that currently prevent dividend declarations despite the company’s return to profitability.
International Breweries reported a profit in the 2025 financial year after several years of losses, but the accumulated deficit of N191.03 billion remains a constraint under corporate law, which prohibits companies from paying dividends while retained earnings remain negative.
By offsetting those losses against the Share Premium Account, the company expects to restore distributable reserves, allowing future profits to be available for dividend payments once approved by the board.
Following the elimination of accumulated losses, International Breweries also plans a second capital restructuring involving a reduction of its Share Premium Account to facilitate a return of excess capital to shareholders.
Under the proposal, shareholders would receive a pro-rata capital distribution based on the total amount approved by the board.
The company said the amount payable per ordinary share will be determined after the board finalises the size of the proposed distribution.
Unlike dividends, which are paid from distributable profits, capital repayments involve returning part of a company’s surplus capital to shareholders following the required legal and regulatory approvals.
The proposed capital reduction remains subject to several approvals before implementation.
Shareholders will consider the proposal at the company’s forthcoming Annual General Meeting (AGM), after which the transaction will require approvals from the relevant regulators as well as confirmation by the Federal High Court, as stipulated under the Companies and Allied Matters Act.
If approved, the restructuring would represent an important milestone in International Breweries’ financial recovery, positioning the brewer to combine stronger earnings with the capacity to resume shareholder distributions after years of accumulated losses.
