Home Business EABL posts 22pc drop in half-year net profits

EABL posts 22pc drop in half-year net profits

East African Breweries Limited (EABL)

East African Breweries PLC (EABL) has reported Kshs 66.5 billion in net sales for the half year ended December 31, 2023, representing a 16pc growth compared to prior year.

EABL Group’s volumes increased by 2pc, lifted by resilient consumer demand as markets leveraged a strong and expanding portfolio with brilliant commercial execution.

The Group reported net sales growth across the three markets: Kenya at 10pc, Uganda at 31pc and Tanzania at 9pc.

Additionally, beer and spirits categories grew at 18pc and 13pc respectively.

EABL’s half-year profit after tax declined 22pc to Kshs 6.8 billion compared to same period last year, primarily driven by macro-economic-driven cost inflation and rising finance costs.

Further, the devaluation of local currency has resulted to (FX) loss of Kshs 2.3 billion, an increase of Kshs 2.1 billion versus same period last year.

EABL Group Managing Director and CEO, Jane Karuku, said: “We have achieved a resilient set of results in the half-year period. Our great brand building, brilliant commercial execution, as well as consumer insight led innovation, has allowed us to continue our revenue growth momentum. However, our bottom line has been impacted by increased costs of inputs, currency devaluation and rising interest rates.”

Adding that: “Following the commissioning of our microbrewery, we have accelerated the launch of exciting beer and cider propositions. We continued to deliver on our Environmental, Social and Governance (ESG) strategy, yielding positive results around water efficiency and carbon footprint.”

EABL continued to invest behind its brands with advertising and promotions spend rising 16.5 percent to Kshs 6.1 billion. The company’s Kshs 1.2 billion microbrewery in Kenya started producing the first innovation brands during the half.

Looking ahead, Karuku said: “Our priorities for the second half are clear: we will remain consumer centric and execute brilliantly to keep up with the dynamism in the market, drive cost efficiencies to grow margins and invest smartly in our brands and business.

Further, we will continue to deliver against our ESG commitments, whilst driving high performance culture and engagement of our people.”

The EABL Board has recommended an interim dividend of Kshs 1 per share to be paid on or about April 26, 2024.