Rwanda’s brewing company Bralirwa Plc has announced a growth in revenues mainly driven by continued growth in consumption of volumes of beer and soft drink amidst the Covid19 pandemic.
Bralirwa’s unaudited financial results for the period ended 30 June 2021 show that volume and revenue increased by 13.2% and 19.8% respectively.
This was mainly driven by the continued growth of beer and the recovery of soft drink volume, Bralirwa said in a statement upon publication of the results this Thursday, August 5, 2021.
Revenue increased by 27.5% to Rwf 56.8 billion in the first half year of 2021 (HY 2020: Rwf 44.6 billion). This was mainly due to the increase in volume and positive price effect.
“Revenue growth is driven by improved growth of beer and the recovery of soft drink volume and reclassification of proceeds from services from other income to revenue in 2021,” Bralirwa said.
Bralirwa results from operating activities mainly driven by top-line growth and other income (mainly due to proceeds from the disposal of assets) were partially offset by many reasons.
These include: increased cost of sales (+18.6%) mainly due to high volume and price effect mix (Fx impact), higher selling and distribution costs (+8.2%) driven by the higher level of activities (promotion & activations).
However, Bralirwa’s net finance costs decreased by 8.8% mainly driven by a reduction of debt interest and IFC long-term loan.
The company’s income tax expense increased by 83.3% mainly driven by high Profit Before Tax compared to last year.
Merid Demissie, Vice Chairman of the Board and Managing Director of Bralirwa said that despite the ongoing COVID-19 pandemic and the measures that are in place to slow down the spread of the virus, Bralirwa Plc. has been able to perform well.
“Both volume and revenue increase was mainly driven by a more intentional route to the consumer that targeted off-premise channels such as supermarkets and grocery stores.
This promising H1 top-line performance translated to a favorable operating result driven by a continued focus on cost management,” Demissie said.
Bralirwa’s operating result increased to Rwf 12.6 billion (HY 2020: Rwf 8.9 billion) resulting from strict cost management in addition to COVID-19 mitigating actions. Profit and total comprehensive income for the first half-year of 2021 grew by 64.2% to Rwf 6.5 billion (HY 2020: Rwf 3.9 billion).
Bralirwa’s total capital expenditures in the first half-year of 2021 increased due to the enhanced investment in plant and equipment.
The company said that more capital expenditures are expected in the second half of the year.
Debt repayment continued to further reduce our debt position, said Bralirwa officials. This combined with leveraging the improved financing terms and conditions resulting in a reduction of the net finance cost.
In the second half of 2021, Bralirwa expects an increase in volume compared to last year with the expected relaxation of COVID 19 government restrictions and the continued leverage on the route to market and effective allocation of commercial firepower.
Bralirwa expects the market to remain competitive but the overall beverage market to be impacted by COVID restrictions on trade.