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Guinness Nigeria (NSA:GUIN) Financial Strength : 7 (As of Sep. 2023)


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What is Guinness Nigeria Financial Strength?

Guinness Nigeria has the Financial Strength Rank of 7.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Guinness Nigeria's Interest Coverage for the quarter that ended in Sep. 2023 was 7.39. Guinness Nigeria's debt to revenue ratio for the quarter that ended in Sep. 2023 was 0.25. As of today, Guinness Nigeria's Altman Z-Score is 1.01.


Competitive Comparison of Guinness Nigeria's Financial Strength

For the Beverages - Brewers subindustry, Guinness Nigeria's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Guinness Nigeria's Financial Strength Distribution in the Beverages - Alcoholic Industry

For the Beverages - Alcoholic industry and Consumer Defensive sector, Guinness Nigeria's Financial Strength distribution charts can be found below:

* The bar in red indicates where Guinness Nigeria's Financial Strength falls into.



Guinness Nigeria Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Guinness Nigeria's Interest Expense for the months ended in Sep. 2023 was ₦-1,060 Mil. Its Operating Income for the months ended in Sep. 2023 was ₦7,832 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Sep. 2023 was ₦160 Mil.

Guinness Nigeria's Interest Coverage for the quarter that ended in Sep. 2023 is

Interest Coverage=-1*Operating Income (Q: Sep. 2023 )/Interest Expense (Q: Sep. 2023 )
=-1*7831.647/-1059.537
=7.39

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Guinness Nigeria's Debt to Revenue Ratio for the quarter that ended in Sep. 2023 is

Debt to Revenue Ratio=Total Debt (Q: Sep. 2023 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(58995.564 + 159.713) / 238145.908
=0.25

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Guinness Nigeria has a Z-score of 1.01, indicating it is in Distress Zones. This implies bankrupcy possibility in the next two years.

Warning Sign:

Altman Z-score of 1.01 is in distress zone. This implies bankruptcy possibility in the next two years.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Guinness Nigeria  (NSA:GUIN) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Guinness Nigeria has the Financial Strength Rank of 7.


Guinness Nigeria Financial Strength Related Terms

Thank you for viewing the detailed overview of Guinness Nigeria's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Guinness Nigeria (NSA:GUIN) Business Description

Traded in Other Exchanges
N/A
Address
Cocoa Industries Road, Ikeja, Lagos, Ikeja, Lagos, NGA, 21071
Guinness Nigeria PLC is a beverage manufacturing company. The company is engaged in brewing, packaging, marketing and selling of various beverage brand including Guinness Foreign Extra Stout, Guinness Extra Smooth, Malta Guinness, Malta Guinness Low Sugar, Harp Lager, Smirnoff Ice, Satazenbrau Lager, Snapp, Orijin Spirit Mixed Drink, Orijin Bitters, and many more. Geographically, it derives a majority of revenue from Nigeria.

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