Cheap Beer Boosts Full-Year Profit At Diageo’s Kenyan Unit
Low-end brands such as Senator helped East African Breweries Ltd., the region’s largest brewer, post a 7 percent increase in full-year profit to 10.3 billion shillings ($101.6 million) in the 12 months through June.
The distributor of Diageo’s brands such as Johnnie Walker whiskey and Guinness stout products controls most of Kenya’s beer market and half of the country’s spirits business.
“The performance was largely driven by continued growth in the spirits category, recovery of Senator in Kenya, and innovation across all markets,” it said in a statement e-mailed from the capital, Nairobi.
The so-called emerging beer segment, which includes brews such as Senator in Kenya, Ngule in Uganda and Pilsner in Tanzania, grew by 112 percent, Kenya’s second-biggest company by market value said. Mainstream beer was down 6 percent, while premium and emerging spirits declined by 9 percent and 2 percent respectively.
EABL, which is 50.03 percent owned by London-based Diageo, said the group’s net sales were flat following a declining performance in its South Sudan business and the negative foreign-exchange impact of a currency devaluation in the nation.
EABL closed 4.4 percent higher at 285 shillings before the results were announced, extending gains this year to almost 6 percent.
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