Tanzania: Dar Market Boosts Eabl Sales Despite Virus

THE East African Breweries Limited (EABL) market in Tanzania grew to double digit in the first six month of this year despite coronavirus pandemic, while dropped in Kenya and Uganda.

The Tanzania market climbed up to 14 per cent compared to Kenya and Uganda that registered decline by 14 per cent and 5 per cent, respectively in the same period.

Tanzania double digit growth in premium and mainstream beer segments and improved spirits performance supported a strong delivery for EABL this financial year.

However, the regional beer maker's the annual financial reports show that the first-half growth of 19 per cent in Tanzania slowed down to 10 per cent in the second half as government restrictions in response to Covid-19 were limited.

The EABL recorded a 9 per cent decline in net sales for the financial year ended June as first half growth of 10 per cent was offset by a 29 per cent decline in the second half.

The second half decline was due to the impact of the Covid-19 pandemic which saw containment measures implemented across East Africa from late March this year.

The pandemic impacted EABL's business performance after three consecutive double-digit halves of growth, with profit for the year declining by 39 per cent to KShs 7 billion from KShs 11.5 billion in the previous year.

The EABL Group Managing Director and CEO, Andrew Cowan, said: "During this unwelcome pandemic, our top priority has been to safeguard the health and well-being of our people and support our communities, while taking necessary action to protect our business.

Across the markets we have tracked changes in consumer behaviour and repurposed our execution plans in trade to continue serving our consumers where safe and possible to do so."

Mr Cowan said EABL focused on managing working capital tightly in the last quarter, reducing discretionary expenditure and reallocating resources such as advertising and promotion (A&P) spend to new and emerging channels in order to serve our consumers safely.

EABL has made a significant contribution through trade and community initiatives across the region.

To help East African communities emerge from the effects of the pandemic, EABL has funded provision of hand sanitizers distributed to frontline health workers and vulnerable communities to the tune of Kshs 70 million.

Further, the company donated Kshs 50 million to Kenya's Covid-19 Emergency Fund, bringing the total contribution towards the pandemic to Kshs 120 million.

In Uganda, UBL donated hospital mattresses, hand-washing stations and fuel to enable frontline health workers alleviate situation in healthcare centres.

And in Tanzania, Serengeti Breweries Limited (SBL) delivered a hygiene awareness programme and donated hand-sanitizers to help combat the spread of the pandemic.

"Going forward, our market teams have put in place robust plans to help us emerge stronger from this crisis once the measures are eased across our markets. We will continue to execute with discipline and invest prudently to ensure we are strongly positioned for a recovery in consumer demand," Mr Cowan said.

In recognition of the uncertainty in the external environment in the face of the Covid-19 pandemic and the need to conserve cash to support the business, the Board of Directors do not recommend a final dividend. Consequently, the interim dividend of KShs 3 per share paid in April 2020 will be the full and final dividend for the year.

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