Uganda Breweries Limited defies closure of bars to post 33% revenue growth

Despite a difficult business environment due to Covid-19, Uganda Breweries Limited (UBL) has registered growth in revenue for the year ended June.

The revenue growth, which stood at 33 per cent,  was mainly supported by flagship brands in both beer and spirits divisions, which all recorded double-digit growth.
The growth, according to UBL, was also supported by Uganda Waragi.

Mr Alvin Mbugua, the UBL managing director, last week said in a statement that the growth was driven by the business’ agility in response to the changing consumer shifts and emerging channels by investing in capacity expansion.

However, the growth came against a tough operating environment, exacerbated by Covid-19 disruptions and growth of the informal alcohol sector.

“The closure of bars and entertainment venues, and other restrictions necessitated by measures to curb the spread of Covid-19, affected not only our customer base but also led to both local and global supply disruptions for our produce and for raw materials that we need in our production processes,” Mr Mbugua, said noting that the unregulated alcohol sector continues to eat into its market thus affecting profitability.

Mr Mbugua also noted that manufacturers in the beer, spirits and wine sectors will continue to engage government and other stakeholders to improve the operating and tax environment as well as open up dialogue with other with the view of identifying and tackling issues rising from illicit trade.

The brewery sector has had to turn to new innovations such as creating e-commerce partnerships in which they continue to seek improvements in distribution channels.
Key among the innovations include creating robust delivery channels as well as embracing e-marketing platforms to promote aggressive product sales.

Mr Mbugua also noted that the 30 per cent levy on beverages produced using local raw materials was considerably high considering the annual investment the industry makes in farming communities in eastern, northern and south western Uganda.

–Daily monitor