East Africa Breweries Ltd yesterday announced its half years results in which revenues were Ksh. 36.8 Billion while profits dropped by 11% to stand at Ksh. 4.95 Billion.
During the period, volumes grew by 4% while revenue also rose by 5%. However, net earnings were negatively impacted by low sales during the electioneering period and excise tax changes in the Ugandan market.
In the Kenyan market, there was an 8% increase in volume driven by the resurgent performance of bottled beer and a double-digit growth in spirits. Senator Keg on the other hand was down 22% due to a partial shut down of its production line in order to expand capacity, higher consumer prices and the election period which negatively affected consumer activity and expenditure.
In the Ugandan market, volume grew 15%, but the negative impact of excise on imports, down-trading and the contribution of spirits packaged in sachet formats reduced margins and resulted in overall flat net sales. The Serengeti brand family led the recovery in Tanzania, up 28% overall on the back of the successful launch of the Lite variant.
The reduction in profits was explained as being due to an 18% increase in investment into brands and sales, and higher interest charge on long-term borrowings.
The Board of Directors recommended an interim dividend of Kshs 2.00 per share for the half-year period