EABL Group’s earnings undermined by regional macro-economic slowdown

o   Net sales growth remained flat to prior year at Kshs 109 billion, impacted by depressed consumer wallets

o   Uganda and Tanzania top line performance up 17% and 1% respectively, while Kenya declined by 4%

o   Recommended final dividend at Kshs 1.75 per share, and a total dividend of Kshs 5.50 per share

East African Breweries PLC (EABL) has reported Kshs 109 billion in net sales for the full year ended June 30, 2023, 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 delivered net profit of Kshs 12 billion, a 21 percent decline, 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.

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.

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.”

Ms. Karuku added: “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.”

EABL continued to reap from smart investment behind brands, digital and consumer experiences, investing Kshs 12.9 billion in capital expenditure during the year. The company’s Environmental, Social and