EABL Records 47 Percent Decline in Profit For 1HY21
East African Breweries Limited (EABL) recorded a 3% decline in net sales to Kes 44.5 billion for the half-year ended December 2020 compared to the same period in 2019. This, however, was a 53% improvement from the previous half-year period, January to June that was significantly impacted by Covid-19 restrictions. However, the pandemic still affected EABL’s business performance with the group recording a 47% decline in profit after tax from kes 6.7 billion in 2019 to kes 3.8 billion during the period under review.
Markets Net Sales Highlights for the Financial Year 2020:
Kenya: Declined 10% compared to the same period in 2019. The decline was attributed to the Covid-19 containment measures that saw continued closure of bars and a ban on alcohol sale in restaurants in the first quarter.
Tanzania: Grew 17% compared to the same period in 2019. EABL attributed the growth to broad-based growth across all categories. Beer net sales grew 17% with strong growth from the ongoing success of the Serengeti.
Uganda: Grew 13% compared to the same period in 2019. The growth was driven by leveraging wholesale channels, enlisting new selling points at mini-shops, home deliveries and e-commerce partnerships.
However, the gross margin showed a strong recovery at 43% during the financial period ended 30 December 2020, as compared to 38% that was recorded in the period January to June.
As a result of the challenges brought about by the ongoing pandemic, EABL said they had initiated Programme called Raising the Bar Programme that helps pubs & bars recover from the Covid-19 disruptions. This constitutes hygiene kits, permanent sanitiser dispenser units, and projection screens for bars to comply with reopening protocols & to deliver the required hygiene standards.
The group has expressed optimism of growing stronger this year with Jane Karuku, EABL Group MD & CEO saying “we will continue to emerge stronger as a business. This will be done through the recovery of the business, investing smartly, having a culture of speed and agility, increasing productivity and enhancing our reputation”.
The board did not recommend an interim dividend payment due to the uncertain conditions brought by the prevailing pandemic.