East African Breweries Limited (EABL) recorded 15% growth in revenue to Kshs86.0 billion for the year ended June 2021. | THE INDEPENDENT | Profit before tax was up 2% to Ksh10.9 billion. The slower profit growth rate was driven by the impact of cost inflation, adverse foreign exchange impact and tax charges.
EABL’s profit after tax for the period declined 1% to Kshs7billion mainly impacted by cost inflation, tax and foreign exchange impact. EABL’s performance was delivered on the back of a tough operating environment.
The company responded with agility, leveraging changing consumer behaviour and channel shifts, especially around e-commerce, home delivery and take-home trade, executives said.
Market sales performance
Kenya Breweries Limited (KBL) registered 10% year on year revenue growth, with H2 growing 45% off-setting a 10% decline in H1.
This performance was driven by expanding and adapting the product portfolio to meet emerging channels and new consumer occasions while continuing to invest ahead on our strategic brands.
Uganda Breweries Limited (UBL) revenues on the other hand grew 33% year on year, with beer and spirits both recording double-digit growth.
Growth was driven by the business’ agility in response to the changing consumer shifts and emerging channels. The business also invested in capacity expansion to support sales growth in line with EABL’s strategy.
“The closure of bars and entertainment venues, and other restrictions necessitated by measures to curb the spread of the COVID -19 pandemic, affected not only our customer base but also led to both local and global supply disruptions, for our produce and for raw materials that we need in our production processes.” Said Alvin Mbugua the UBL managing director.
Mbugua added that the tax burden bore by the regulated and licensed alcohol beverages sector and the illicit and unregulated sector continues operating tax free continues to eat into the profit margins of the industry.
“We continue to engage government and other stakeholders to improve the operatingregulatory and tax environment as well opening up dialogue with the different stakeholdersto identify and tackle issues rising from illicit trade, key of which is cost of revenue to thegovernment through missed taxes,” Mbugua said.Going forward, Mbugua said the 30% levy on beverages produced using local raw materials is steep considering the annual investment the industry makes in farming communities in Eastern, Northern and South Western Uganda where Uganda Breweries alone contributes more than Shs30billion annually.According to a report by EuroMonitor International, a market research firm, in the […]
