Gin revolution gets EABL high on profits

Gin revolution gets EABL high on profits

Gin contributed five per cent of Diageo’s reported net sales in the period between July and December 2021. The Gin revolution in Africa was driven by the prodigious consumption of Gilbey’s in Kenya.

This is according to Diageo, a London-based multinational brewer that owns the majority stake in East African Breweries Ltd (EABL), in its interim results for the first six months ending December 2021.

Gin contributed five per cent of Diageo’s reported net sales in the period between July and December 2021 as its sales grew 21 per cent in the review period.

Made from Juniper berries, Gilbey’s is a type of gin that has a slightly piney flavour with a touch of both fruitiness and pepperiness.

It became the tipple of choice for many Kenyans during the pandemic, a period in which pubs and clubs had been closed.

The growing popularity of the drink has resulted in the Gin Revolution around the world.

Unlike whiskey, Gilbey’s is friendly on the pocket, a major selling point to price-sensitive Kenyan consumers. For instance, a 750ml bottle goes for around Sh1,250 at a liquor store.

John Musunga, the Managing Director of Kenya Breweries Ltd, a subsidiary of EABL, noted that gin consumption has peaked around the world.

“Consumers will choose what works for them, and this time around it is gin,” he said.

EABL’s profits more than doubled in the first six months to Sh8.7 billion even as the brewer announced an interim dividend of Sh3.74 per share.

The performance is compared to a profit after tax of Sh3.8 billion that the brewer made in the first half of 2020, a period when alcohol sales were ravaged by the negative effects of the Covid-19 pandemic, including the closure of bars and a dusk-to-dawn curfew.The company’s share price at the Nairobi Securities Exchange (NSE) jumped by 7.4 per cent to trade at Sh167 by the close of trading on Friday.Mainstream spirits, a category under which Gilbey’s falls, grew 25 per cent in the period under review, while the premium spirits grew by a fifth.Indeed, imports of brandy, gin, whiskey and rum increased by 45 per cent at the height of the Covid-19 pandemic, according to official data. This is the highest jump in seven years.Data from the Kenya National Bureau of Statistics (KNBS) shows the quantity of imported hard liquor jumped to 16.3 million litres in 2020, compared to 11.2 million litres of spirits that Kenyans brought into the country from […]

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