East African Breweries Limited today announced its half year results for the six months period ended 31st December 2015 delivering 16% growth in profit after tax from continuing operations driven by net sales growth of 8%. The results were driven by double digit growth in five out of eight product segments and recovery in Senator keg post the review in duty remission in Kenya.
“We have delivered solid performance despite the challenging economic environment in East Africa” said EABL Group Managing Director, Charles Ireland. We have seen in the business volatility and foreign currency challenges across the region, however we have a clear strategy and will continue to build on new opportunities to drive our business growth” added Mr. Ireland.
Kenya delivered 22% net sales growth, mainly driven by a good performance from Senator keg and spirits. Innovations led by Chrome Vodka, Kenya Cane Coconut and Allsopps Stout also contributed to the growth.
Net sales in Uganda and Tanzania remained flat in local currency terms. We experienced a decline in the export markets mainly due to the volatile environment in South Sudan.
Selling, distribution and administrative expenses increased by 10% when compared to the same period last year as we continue to invest in our brands, route to consumer and people.
Cash flow from operating activities increased by 51% to Kshs 11.4 billion as a result of efficient management of working capital. Net Capex spend for the period was Kshs 1.5 billion covering investment in plant and machinery and returnables in order to meet the increased demand.
Total net borrowings decreased by Kshs 8.5 billion as a result of strong operating cash flow and the sale of CGI, contributing to a 38% decrease in net finance costs in the period.
EABL’s profit after taxation from continued operations improved by 16% to Kshs 5.5 billion. The total profit for the half grew by 67% to Kshs 7.7 billion inclusive of the contribution from the disposal of CGI, the glass making subsidiary and netting off nearly Kshs 1.0 billion of negative impact from South Sudanese pound currency devaluation.
The Board of Directors recommended an interim dividend of Kshs 2.00 per share up from Kshs 1.50 last year.