High Gin consumption among women in Kenya drove East African Breweries' sales in the year ended June 30, with the firm projecting a strong post-covid recovery.
This, as the company recorded a 15 percent revenue growth to Sh86 billion, driven by smart investment behind brands, channel focus, and innovations.
Profit after tax however slightly dropped by one percent to Sh7 billion, mainly impacted by cost inflation, tax, and foreign exchange impact.
Further, the Covid-19 related tax reliefs in Kenya on corporation tax and VAT ended in December 2020, resulted in higher tax charges for the year as the rates reverted back to pre-Covid levels.
“We have seen female consumers starting to get into this category. Consumption of gin gas has been fantastic,” said Jane Karuku, Group Managing Director and Chief Executive Officer of EABL.
Common Gin brands in the Kenyan market include Gilbey's, Beefeater, and Gordons, with Gin alcoholic percentage averaging 40%.
The brewer has also made gains from off-trade sales with signatures whiskeys moving fast mainly at wines and spirits and supermarkets.
“Shopping habits have changed,” noted Martin Oduor-Otieno, EABL chairman.
Canned beers have also played a key role in driving the company's sales in the wake of the pandemic, where bars and restaurants continue to operate on limited hours.
“e-Commerce has also been very significant,” the firm said on Friday during its financial results for the year ended June 2021.
The group's net cash from operating activities was up 337 percent to Sh14.6 billion, driven by “tight management of working capital and productivity initiatives”.
Kenya Breweries Limited (KBL) registered 10 percent year-on-year revenue growth, with half two growing 45 percent, offsetting a 10 percent decline in half one.
“Performance was driven by expanding and adapting the product portfolio to meet emerging channels and new consumer occasions while continuing to invest ahead on our strategic brands,” the firm noted.
On the other hand, Uganda Breweries Limited (UBL) revenues grew 33 percent year on year, with beer and spirits both recording double-digit growth.
“Growth was driven by the business’ agility in response to the changing consumer shifts and emerging channels. The business also invested in capacity expansion to support sales growth in line with EABL’s strategy,” the group said in a statement.
In Tanzania, Serengeti Breweries Limited (SBL) revenues were up 15 percent with beer and spirits both registering double-digit growth.
According to the firm, the business sustained strong growth through investment behind the brands and capacity expansion for both beer and local spirits production.
The company’s key priority has been to ensure the safety and well-being of its people by providing the necessary tools and resources to ensure they are adequately enabled to work safely, as the pandemic remains a challenge to economies.
“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,” Karuku, said.
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