Seven NGX foreign firms paid N129.4B to parents; Nestlé fees + interest > shareholder profit
Seven foreign-owned companies on the Nigerian Exchange paid N129.4 billion in royalties, licence, technical and management fees to their parent groups in the nine months through September 2026, up 7.7% from N120.1 billion a year earlier, according to unaudited Q3 filings.
At Nestlé Nigeria, fees plus interest on an intercompany loan from its Swiss parent totalled roughly N110 billion — exceeding the N103.4 billion profit after tax left for all shareholders. The company paid N34.8 billion in licence fees, N16.5 billion in shared-service costs, and N58.5 billion in loan interest. Nestlé's results were otherwise strong: revenue rose 10.4% to N976.5 billion, pretax profit jumped 52% to N193.9 billion, and shareholders' equity recovered to N116.3 billion from negative N112.1 billion two years ago.
At three companies, fees grew faster than revenue. HBM Nigeria's technical fees rose 28% to N21.7 billion against 19% revenue growth. International Breweries' fees jumped 23% to N11.7 billion while revenue grew just 2.1%. Nigerian Breweries' fees rose 12% to N28.9 billion versus 5.4% revenue growth.
Not all fees have left the country. Nigerian Breweries owes Heineken N90.6 billion (up from N55.4 billion), and HBM owes Huaxin N29 billion (up from N6.6 billion) — signalling future cash outflows.
The payments are legal and capped by NOTAP as a share of net sales. But they come after parents spent heavily to repair balance sheets shattered by the naira's 2023-2024 collapse. Heineken took up Nigerian Breweries' N599.1 billion rights issue. AB InBev converted a $379.9 million loan into International Breweries shares. International Breweries then returned N84 billion capital to shareholders — N82 billion to AB InBev.
Three companies paid less: Guinness Nigeria fees fell 15% to N9.8 billion under new owner Tolaram; Beta Glass stopped management fees after Helios buyout; Cadbury Nigeria fees dropped 8% to N2.2 billion.
If you hold minority shares in these subsidiaries, the question is whether parent extraction leaves enough for you — especially as accrued fees not yet paid will eventually drain cash.