East African Breweries PLC (EABL) has reported a net profit of Ksh. 12 Billion for the full year ended June 30, 2023. This represents a 21 percent decline from a similar period last year.
The decline in profitability was on the back of rising input costs, multiple excise tax increases and currency depreciation which could not be fully offset by increased prices and cost management initiatives.
During the period EABL reported Kshs 109 billion in net sales a similar revenue performance compared to prior year. EABL’s Group volumes were down 7 percent year-on-year, as sales were impacted by sluggish consumer spending as effects of the tough macro-economic environment and regulatory disruptions took a toll on depletions.
Net sales in Kenya declined 4 per cent with excise tax escalation impacting the price-sensitive mainstream segment. The trade environment in Kenya also impacted performance, particularly trade distractions leading to county-led bar closures. However, the premium spirits segment proved resilient, registering double-digit growth.
Uganda continued its encouraging half-year growth trajectory, closing at 17 percent growth aided by pricing benefits and modest volume growth. Tanzania registered modest growth of 1 percent as the market continues to adjust to price increases taken earlier in the year.
EABL Group Managing Director & CEO, Ms. Jane Karuku said: “EABL remained resilient despite the macro- economic headwinds – including global inflation and geopolitical disruptions – which disproportionately raised our costs and depressed consumer spending across the year. Amidst these challenges, we maintained our strategic focus on delivering value to our consumers and all our stakeholders through executional excellence, and operational efficiency. As we navigate the current volatility, we remain optimistic about the growth prospects for our business. We continue to invest in our advantaged portfolio of brands and insight-led innovations to meet the ever-evolving needs of our consumers. Together with the relentless dedication of our teams, I expect that we will continue to deliver topline growth, sustained profitability and consistent cash flow generation.”
The EABL Board has recommended a final dividend of Kshs 1.75 per share, bringing the total dividend for the year to Kshs 5.50 per share.