Local Market Drives Namibia Breweries Profit

THE local market drove Namibia Breweries Limited (NBL) profit after tax to reach N$170 million in the six months ended 31 December 2013 compared to N$121 million in the same period in 2012. Profit before tax was N$235 million compared to N$181 million for the same period in 2012.

Revenue in the six months ended 31 December 2013 increased to N$1,35 billion compared to N$1,22 billion in the same period in 2012, the company said in interim results released yesterday.

“In Namibia, sales volumes of beer have continued to grow gly while softs and the ready-to-drink range (RTD) volumes have only seen a marginal growth when compared to the previous period. Tafel continues to outperform other brands within the beer portfolio. Supported by the g growth of Tafel, NBL has been able to increase its market share of beer in Namibia. Beer volumes produced and sold to DHN Drinks (Pty) Ltd were up by seven compared to prior year whereas RTD volumes were down by 84%,” the company said.

The company attributed the growth in operating profit by 17% compared to the previous period to the increase in volumes and further supported by pricing.

NBL said South African joint venture, DHN Drinks continued to grow its total portfolio, with increasing sales compared to the prior period, the RTD portfolio being the main driver of growth.

The company said total beer, including the Windhoek Trade mark saw a slight decline in the period.

“The operating loss attributable to DHN Drinks decreased compared to the previous period,” the company said.

It said export volumes excluding South Africa grew compared to the prior year with Mozambique and Tanzania seeing good growth in volumes albeit from a small base.

“Competition continued to increase particularly in the SADC countries we trade in. Maintaining margins will remain a key focus point going forward. The recently launched Windhoek Lager campaign will be rolled out to the rest of the region and will start to yield results in the near future. We do not however expect current financial performance to continue at similar levels for the reminder of the year,” the company said.

The board of directors declared an interim dividend of 34 cents per ordinary share.

NBL also announced that there are on going discussions surrounding a proposed transaction which involves a restructuring of existing arrangements between Diageo Highlands Holdings, Heineken International B.V. in South Africa.

“By this transaction DHN Drinks, the shareholders of which are Diageo, a subsidiary of Diageo Plc, Heineken, a subsidiary of Heineken B.V. and NBL, intend to acquire 100% of the issued share capital of Sedibeng Brewery, which owns the Sedibeng brewery, the current shareholders of which are Heineken and Diageo,” NBL said.

Source : The Namibian