Staff Reporter
Windhoek-PERFORMANCE HIGHLIGHTS:
• Revenue N$1.4 billion, down by 3.0 percent
• Operating profit N$345 million, up by 5.8 percent
• Profit after tax N$240 million, up by 150.2 percent
• Earnings per share 116.3 cents, up by 150.2 percent
• Headline earnings per share 123.0 cents, up by 8.5 percent
• Interim dividend per ordinary share 46 cents, up by 9.5 percent
Namibia Breweries Limited (NBL), with just over 800 employees, maintained its strong market position despite a strained local economy, challenges in export markets and declining consumer spend. For the half year ended December 31, 2017, the Namibian, South African and export volumes decreased by 1.8 percent, 22.9 percent and 1.8 percent, respectively. This resulted in the overall beer volumes and revenue decreasing by 7.7 percent and 3.0 percent. Operating profit was 5.8 percent higher than the comparative period due to a decrease in operating expenses resulting from improved efficiencies. Based on these results, the NBL Board declared an interim dividend of 46c on March 1, 2018, which represents an increase of 9.5 percent from the previous period.
Our half-year performance demonstrates NBL’s resilience and ability to adapt to changes within our operating environment. It is also the direct result of our employees taking ownership of challenges and creating opportunities to bring our purpose to life. Without this, NBL would have delivered a very different result,” said NBL Managing Director (MD), Wessie van der Westhuizen on Friday at the announcement of the results.
Despite the decline in beer volumes, locally listed NBL still enjoys a majority market share in Namibia. NBL’s own craft brand, Camelthorn, was renovated and relaunched in July 2017, thereby accessing the growing craft beer segment in both South Africa and Namibia. Innovation in this category is specifically aimed at growing the craft beer segment, and responding to consumers’ ever-changing needs.
NBL also launched the Strongbow cider brand in Namibia, with which it entered the cider market and further diversified its product portfolio and the company successfully collaborated with Heineken Africa in the development, trial and production of Amstel Radler, a new product for the South African Market.
“Despite a challenging trading environment, and an overall decrease in beer volumes of 7.7 percent, NBL managed to increase its operating margin to 23 percent. Profit attributable to shareholders of N$240 million was delivered for the six months ended 31 December 2017, an increase of 150.2 percent on the prior year. This increase in mainly attributable to exceptional performance of Heineken South Africa for this period,” explained NBL Finance Director, Graeme Mouton.
Commenting on the outlook for NBL, Van der Westhuizen concluded: “With the changing operating environment, it is continually becoming important to diversify our business, product and brand portfolio in an effort to remain competitive, while at the same time remaining focused on our core business. Specific focus will be to drive operational efficiencies in order to maintain sustainable growth and retain healthy margins in the local market. NBL will also continue to further explore investment opportunities in promising markets and believes that our investment in South Africa will increase our overall profit derived from that market.“