KBL TO EXPORT CHIBUKU TO SA

KEIKANTSE LESEMELA
Correspondent | Monday June 10, 2013 00:00

 

Announcing the results for subsidiary, Sechaba Brewery Holdings Limited (SBHL) on Thursday, KBL managing director Johan de Kok, said the group is planning to export Chibuku to South Africa because the Botswana market is limited.

'We are cooperating with the government concerning the closure of our depots because we can not keep on running at a loss,' said De Kok. He said the total alcoholic beverages sales declined by 13 percent, with Chibuku and Phafana leading by 24.6 percent.' Our alcoholic beverages brands were 13 percent below last year as a result of the Chibuku sales decline. The trading environment for alcohol-related products remain challenging as the impact of high levy felt by consumers,' he said.

The alcohol levy was increased to 45 percent in October last year and this has resulted in the group increasing prices of its products.De Kok revealed that about 57 shebeens have closed their operations in Palapye and this had led to the closure of KBL Palapye depot. 'Palapye depots have been closed in May 2013 as a result of volumes declining below break-even point,' The group is struggling to invest in beer gardens as land availability continues to be a challenge.' We are struggling to get land in the right place we are trying to get as close as possible to Chibuku consumers but we only find land in far away places.'

The regulations demand that Chibuku should not be sold in residential places but rather in licensed depots.However, total sales of non-alcoholic beverages increased by 27,5 percent the prior year while the Mageu category performed well finishing 43.4 percent ahead of prior year.The traditional beer regulation and a further increase in the alcohol levy resulted in volumes falling below prior year. Although marketing expenses increased by 19 percent as the company continued to invest behind its products, De Kok said the expansion of Castle Lite and St Louis Export into draught was very successful and the group would continue to roll this out across the country in the next financial year although from a lower base.