EABL full year profit flat at Ksh.7 billion
East African Breweries Limited (EABL) has narrowly missed a complete performance turnaround with its full year profit to June slipping by a single percentage point.
The alcohol beverage manufacturer earnings have fallen by a narrow margin to Ksh.6.96 billion from Ksh.7.02 billion at the same stage last year.
The negligible dip in performance is largely attributable to increased costs which offset a resounding 15 per cent growth in revenue to Ksh.86 billion.
A combination of higher costs, adverse foreign exchange and increased tax charges have nevertheless muted the effect of improved sales for the company following initial COVID-19 disruptions at the end of its last financial cycle.
For instance, EABL cost of sales in the year rose by a higher 15.8 per cent to Ksh.48.5 billion from Ksh.41.9 billion previously.
At the same time, EABL income tax charge has risen to Ksh.3.9 billion from Ksh.3.6 billion last year on the reversal of tax reliefs at the end of the 2020 calendar year.
The company says it has successfully responded to COVID-19 disruptions through agility including leveraging e-commerce sales, home deliveries and take home trade.
“Through Fiscal 2021, the pandemic continued to impact the business negatively across East Africa due to the restrictions in Kenya and Uganda and the general decline in disposable incomes in the region. We responded to the new realities by continuing to invest behind the brands, expanding capacity and sustaining productivity initiatives to manage our cost base to ensure we emerge stronger,” said EABL Group Managing Director Jane Karuku.
“We are cognizant of the fact that the uncertainty posed by the pandemic will continue. However, we are confident that our strategy is working and will continue to focus on business recovery to grow top line and recover margin.”
EABL saw its biggest rebound in sales in Uganda where revenues were 33 per cent higher driven primarily by beer and spirits sales.
Tanzania revenues were meanwhile up by 15 per cent while Kenyan sales were up by 10 per cent over the year after registering a 45 per cent hike in sales between January and June this year.
During the year, EABL invested Ksh.7.8 billion to support its new growth channels.
Cognizant to the volatile operating environment, EABL’s board has not recommended a final dividend to shareholders.
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