Nairobi — East African Breweries Limited has recorded a 47 percent decline in net profit to Sh3.8 billion for the half-year ended December 2020 primarily driven by a one-off tax provision.
The drop is also on account of excise duty increases, general price inflation, and additional costs related to digital tax stamp implementation in Uganda which impacted profitability.
During the period under review, the brewer recorded a net sales decline of 3 percent to Sh44.5 billion for the half-year ended December 2020 compared to the same period in 2019.
The company says the performance is 53 percent better than the previous half (January to June 2020) that was significantly impacted by COVID-19 restrictions.
EABL’s spirits net sales grew by 10 percent, partially offset by beer net sales decline of 8 percent against the same period last year.
The decline in beer sales was primarily driven by Senator Keg due to Covid-19 related countrywide bar closures in Kenya.
While releasing the financial statements, Jane Karuku, EABL’s MD and CEO said that although bars and restaurants were re-opened in the second quarter, operations were impacted by the protocols implemented for the safety of consumers as well as the restrictions of opening hours and the curfew.
"Throughout the Covid-19 crisis, we have ensured a dynamic and close connection with the consumer. Our greatest assets remain our brands and we have been able to adapt to the changing consumer needs while providing safe channels through which they have continued to enjoy our products, " Karuku said.
"We remain cautiously optimistic about the second half of the year, not least because the pandemic and potential shifts in our trading environment present risks on the horizon. We will continue to stay close to our consumers, innovate to address the consumer patterns, tightly manage our costs, and with agility reallocate resources to address the dynamic operating environment."
Last month, EABL started the rollout of its Sh558 million ($5 million) East African fund in Kenya to help pubs and bars recover from the Covid-19 disruptions.
The support constitutes hygiene kits, permanent sanitizer dispenser units, as well as protection screens for bars to comply with reopening protocols and to deliver the required hygiene standards.Eligible bar owners in the Nairobi metropolitan have until February 12, 2021 to apply for the support while fund launch dates in Uganda and Tanzania will be announced in coming months."We are committed to the safety and comfort of our customers and supporting the trade […]