Water shortages dent Sechaba�s beer sales
Isaac Pinielo | Wednesday August 31, 2016 18:00
Group managing director, Johan De Kok said this was mainly due to the negative growth of the traditional beer and non-alcoholic beverages categories, at -6.5% and -16.0%, respectively.
However, the alcoholic fruit beverage category recorded an impressive 95.6% growth in volumes on the back of the successes of Redds Vodka Lemon and Core Original.
“There remains more opportunity for growth in this category. Clear beer also recorded pleasing results at 7.9% volume growth. Carling Black Label continues to be KBL’s flagship brand with a growth of 25% and volume contribution of 55%,” he said. De Kok said Castle Lite continues to perform well, and local brand St. Louis Lager showing signs of recovery and renewed stability. “We are pleased to have introduced Carling Blue Label to the local market during the year,” he said.
According to the MD, traditional beer volumes declined by -16.0% owing to the continued impact of water shortages in the Southern part of the country as well as severe heat conditions.
He noted that water availability has been relatively stable towards the end of the reporting period, translating to a positive outlook for the category. However, he said the Chibuku 2-litre pack continued its path of phenomenal growth at 26% over prior year. “St Louis Lager once again delivered on its brand promise of ‘a fresh perspective’ with the launch of the ‘Fresh Fest’ campaign which was aimed at celebrating summer,” said De Kok.
He further indicated that the company remains optimistic about the future performance of KBL in the wake of improved reliability of water and electricity supply. He expressed confidence that the company has the right talent to implement the company strategy successfully. He said Sechaba Brewery would continue to create shareholder value, and continue to play a significant role in diversifying the local economy and supporting sustainable industries.
Meanwhile, profit for the year improved by 8.5% compared to prior year, aligned to the 8.08% increase in share of results of associate (Kgalagadi Breweries (Pty) Ltd). lhghkjhkTotal comprehensive income improved by 2.8%, and the earnings per share up 8.5%. The Board declared a total dividend of 109 thebe-per-share to shareholders during the year, which represented a nine percent increase on prior year.