East African Breweries Limited has posted a 36 per cent growth for the period ending 31 December, signaling that the beer maker’s drive to expand its capacity within East Africa is bearing results.
EABL recently doubled its production capacity in Uganda by investing Shs43.2 billion in its Luzira Port Bell subsidiary. The firm also extended its market share into Tanzania, taking over Serengeti Breweries in 2010.
The firm grew its operating profit by 20 per cent over the same period.
The growth comes on the back of an unstable operating environment characterised by high levels of inflation and currency depreciations, which were witnessed across East Africa during the period under review.
Mr Alasdair Musselwhite, the managing director of Uganda Breweries Limited – a subsidiary of EABL, attributed the impressive growth to continued brand growth, new investments and focus on the company’s growth strategy.
“Our top-line performance is encouraging with new investments having a great impact on profitability. These include Serengeti Breweries,” Mr Musselwhite said.
He said the growth momentum also accelerated well into the first half with the flagship brand - Tusker growing by 21 per cent, complemented by a solid performance in the premium and mainstream spirits.
The Uganda subsidiary in particular recorded impressive performance during the period posting top-line growth of 43 per cent, compared to Kenya’s 14 per cent and Sudan and Rwanda’s 19 per cent.
Uganda’s impressive performance is supported by a World Health Organization report that places Uganda above other countries in relation to the consumption of alcohol.
The WHO report shows that in addition to the huge consumption of locally brewed gins, the country’s commercial beer consumption grew by about 30 per cent in 2011 with per capita beer consumption standing at 8 litres for every head per annum.
At the press briefing, the firm also announced that it would maintain its interim dividend at Shs70.60 per share, as it was last year.
EABL is the biggest brewery in East Africa with plants in Uganda, Kenya and Tanzania and distribution networks in South Sudan and Rwanda.
Mr Musselwhite’s take on growth
Turbulent environment. In the past period, there have been turbulent macro-economic conditions across East Africa including currency fluctuations, high interest rates and growing double digit inflation, which have spiked operating costs and dug into consumers’ disposable income. However the firm has been able to bypass all the turbulence to register impressive growth.
EABL market share. EABL is the biggest brewery in East Africa with plants in Uganda, Kenya and Tanzania and distribution networks in South Sudan and Rwanda
EABL in Uganda
Brand catalogue. EABL, under its Uganda Breweries Limited subsidiary, manufactures a range of beer brands and spirits including: Bell Lager, Pilsner, Senator, Tusker Malt and Tusker Lager, Smirnoff Ice, Johnnie Walker and Uganda Waragi.