Frigoglass Plc (the parent company of Beta Glass Plc) has announced its intentions to invest between €25-€30 million to expand its furnace capacity at the Beta Glass Guinea plant, located in Agbara, Ogun State.
The investment will increase the plant’s capacity by 35,000 tons per year.
Details of the new investment
A new furnace will be installed to replace the current one which has reached the end of its working life. An additional production line will also be added in addition to the upgrade of the existing production lines. Quality inspection equipment will also be installed
The new plant when installed will enable Beta Glass to produce lighter weight non-returnable glass bottles, for the first time in West Africa. The project is expected to become operational by 2020.
Likely reasons behind the move
The company in its 2017 annual report, stated that demand in Nigeria had recovered in the second half of the year, following improved foreign exchange liquidity and the economy returning to positive growth
In the second half of the year, the stabilization of Naira led to a strong rebound in demand from customers in soft drinks, Beer and Wine & Spirits. Demand for new returnable glass float injections from
customers in the Beer segment started picking up following signs of economic recovery and new product launches,
Frigoglass in an investor presentation for the third quarter ended September 30, 2018, also reemphasized this stating it was witnessing increased demand for glass containers from brewers.
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Beta Glass is currently trading at N61.50 in today’s trading session on the NSE, down 9.96%.
Results for the nine months ended September 30, 2018, show revenue increased from N14.8 billion in 2017 to N19.1 billion in 2018. Profit before tax rose from N3.2 billion in 2017 to N5.1 billion in 2018. Profit after tax jumped from N2.2 billion in 2017 to N3.5 billion in 2018.