Eight major firms in Nigeria have reported a combined currency revaluation loss of N918.1 billion.

This substantial loss is attributed to the sharp depreciation of the Nigerian naira against the US dollar, which experienced a 68.55 percent decline in value by the end of September 2023.NYSC Portal

The naira’s depreciation followed the Central Bank of Nigeria’s decision in June to let the market dictate the currency’s value.

As a result, the naira plummeted from 461/$1 in December 2022 to 777/$1 in September 2023.InformationGuideNigeria

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Financial statements of these firms show that the devaluation from N465/$ at the end of May 2023 to N776.79/$ in September significantly contributed to the recorded exchange losses.

The firms affected include Dangote Sugar Refinery Plc, Dangote Cement Plc, Nestle Nigeria Plc, Nigerian Breweries Plc, Guinness Nigeria Plc, MTN Nigeria Communications Plc, Airtel Africa Plc, MRS Oil Nigeria Plc, and Seplat Energy Plc. Notably, Dangote Sugar Refinery reported a revaluation loss of N90.99 billion.

The World Bank has pointed out that the naira is among the worst-performing currencies in Africa, having lost nearly 40 percent of its value since June. This devaluation has had a significant negative impact on the financial health of these firms, underlining the broader economic challenges faced by Nigerian businesses in the face of currency instability.

The firm said, “In line with the CBN circular of 14 June 2023 (Operational Changes to the Foreign Exchange markets) which introduced the “willing buyer willing seller” on the Investors and Exporters (I & E) Window based on the prevailing market rates, the Group changed its USD/Naira closing rate of 461 as at 31 December 2022 to 756 as at 30 June 2023 and now 776.79 as at 30 September 2023.JAMB Result

“Monetary Assets and liabilities for the Nigeria operations were revalued at this rate resulting in a revaluation loss of N72.88bn for the Group. This was driven by Letters of Credit and foreign vendor balances.

The revaluation loss is included as part of N90.997bn for the group (N90.42bn for the company) in note 10.0 above. The loss has been fully recognised in the month of September 2023.”

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