, NAIROBI, Kenya Feb 12 – East African Breweries Limited(EABL) has posted 11 percent increase in net profit to Sh4.6 billion in six months to December 2014 from the Sh4.1 billion recorded same period 2013.
The management attributed the growth to double digit growth in spirits, premium beer and Ready-to-Drink and improved performance in Tanzania and the export markets.
Gross profit increased by 8.7 percent to Sh17.1 billion from Sh15.7 billion recorded same period 2014 while administrative expenses reduced by two percent to Sh4.39 from Sh4.5 billion same period 2013 following last year’s company reorganisation.
“The growth of nine percent in gross profit was supported by the focus to drive out costs with Sh1.3 billion savings realised from improved raw materials usage, low heavy oil fuel prices and greater production efficiencies,” said Group Managing Director, Charles Ireland.
Tanzania net sales increased by 17 percent with particularly strong performance in the emerging beer category driven by Kibo, Gold Lager as well as an increased focus on spirits and innovation, such as Jebel, Coconut and Serengeti Platinum.
Net sales in Uganda grew by seven percent while Kenya’s net sales increased by 3 percent.
“This performance for the half year reflects the strength of our business and our brands. We are pleased to have delivered these results despite the tough and unpredictable business environment. Our response to these challenges, through innovation; focus on cost and increased efficiencies has paid off during this period,” Ireland said.
“Despite currency challenges, our export markets, supported by the establishment of the local depot in Juba, delivered over 100 percent growth.”
Net interest costs reduced by 7 percent with group borrowings increasing by Sh5.5billion to finance operations and capital expenditure mostly funded by the Commercial paper issued in February last year.
The company spent on a new furnace at their Central Glass Industries facility and an effluent treatment plant upgrade in Uganda, with net capital expenditure to Sh2.3 billion in the period.
The group announced an interim dividend of Sh1.50 per share to be paid on or about 14th April 2015.