TBL profit dwindles by 16pc on challenging environment

Dar es Salaam. The profit of the Tanzania Breweries Limited (TBL) Group of Companies dropped by 16 per cent in the first half of this year.

That happened despite the brewer’s shift in strategy to focus on affordable brands and packs.

The company’s after-tax profit for six months of this year declined to Sh64.5 billion from Sh77.13 billion recorded in a similar period in 2017, according to a financial statement published yesterday.

The company gives reasons for the situation on some measures and heavy rain between April and early June, which disrupted sales and distribution of the brewer’s products.

“Our performance was negatively impacted by the ban in spirits sachets,” said TBL managing director Roberto Jarrin in the statement. “The company continues to drive the strategy of more affordable brands and packs to enable more consumers to switch out of the informal sector.”

Sh30.672 billion was invested during the six months compared with Sh27.999 billion the previous year, according to the statement.

During the period, the company declared and paid Sh350 per share as the first dividend in 2018.

“TBL Group of Companies has experienced a challenging first half of the year that saw revenue declined by three per cent,” he stressed, adding non-recurring items for the period totalled Sh12.8 billion, primarily due to restricting costs. He said normalised operating profit declined by 25 per cent as result of a 1.5 per cent increase in cost of sales, driven by higher raw material prices and a five per cent exercise increase in 2017.

TBL reported that cash generated from operations was Sh78.4 billion and Sh42.039 billion of the amount was utilized to pay corporate income tax and the remaining amount funded capital expenditure.