…as Heineken delivers N$96 million in royalties
By Hilary Mare
FOLLOWING a decrease in turnover, Namibia Breweries Limited (NBL) – a subsidiary of the Ohlthaver & List (O&L) Group – has vowed to prioritise growing its volumes in South Africa and in partnership with Heineken.
The firm’s latest financial report for the year ended June 30 2018 released last week shows the company’s turnover decreasing by 0.8 percent to N$2 687 million (2017: N$2 709 million) predominantly due to the decline in overall volumes sold.
NBL’s Managing Director Wessie van der Westhuizen highlighted that NBL plans to continue developing brands and creating experiences to further diversify and grow volumes.
“Our focus in the short term will be to further grow volumes in South Africa through Heineken South Africa, while exploring longer-term opportunities to establish the footprint in other African markets. We will continue to develop breakthrough campaigns to further promote our brands. We will continue to explore additional opportunities to further manage costs down. This requires a breakthrough approach and emphasises the importance to create a risk free environment where employees are free to further contribute to the success of the business,” van der Westhuizen explained.
Essentially, NBL earned a total of N$96 million (2017: N$94 million) in royalties from Heineken South Africa.
NBL Finance Director, Graeme Mouton said the investment into Heineken South Africa continued to contribute to NBL’s performance in F18, while Namibian beer volumes slightly decreased by 2percent. “ NBL’s overall volume declined by 5.5 percent. NBL maintained its operating margin in line with prior year despite the challenging economic environment. Profit attributable to shareholders of N$398 million was delivered – an increase of 25percent on prior year. This increase is mainly attributable to the significant decrease in equity accounted losses from NBL’s associate, Heineken South Africa and a decrease in operating expenses,” NBL Finance Director, Graeme Mouton said.
Notably, the NBL this year introduced Heineken’s Strongbow Apple Ciders to Namibia, a brand which features three flavours: Dry, Gold Apple and Red Berries.
“The partnership with Heineken is functioning very well on various levels, including production, skills sharing and sales, and in terms of complementary cultures. As a new entity in South Africa, Heineken was able to design and configure a marketappropriate structure, distribution network and sales force – all exceeding performance expectations despite being in operation for less than two years,” NBL noted in its financial report.
The firm also reported that net cash flows from operating activities decreased to N$357 million (2017: N$397 million), mainly driven by the strong South African beer performance.
Net cash outflow from investing activities decreased, mainly due to an increase in finance income.
Capital investment increased to N$163 million, with the most significant investments in assets under construction and retainable containers. Net cash flow from financing activities increased to an outflow of N$158 million (2017: N$100 million outflow) due to the repayment of RMB and Standard Bank loans.
The NBL Board also declared a final dividend of 46c on 4 September 2018, which represents an increase of 9.5 percent from the previous period. The board further approved an additional special dividend of 193.6 cents per share.
Namibia Breweries Limited employs 792 employees and is listed on the Namibian Stock Exchange (NSX) with Ohlthaver & List (O&L) Group the largest investor in NBL.
The company’s brand portfolio includes leading brands such as Windhoek Lager, Windhoek Draught, Windhoek Light, Tafel Lager, Tafel Lite, King Lager, Vigo, Code, McKaneand Aquasplash, amongst others.
Confidente. Lifting the Lid. Copyright © 2015