KENYA – East African Breweries Plc (EABL) has announced a reduction of 168 jobs during the financial year ending in June pushing the company’s workforce below 1,500 employees for the first time in over seven years.
According to EABL’s latest annual report, the headcount now stands at 1,408, down from 1,576 at the end of June 2022.
This decrease is primarily attributed to cutbacks in production employees, which declined by 122 to 759, and management and administration roles, which saw a decrease of 70 to 207.
However, there was an exception in the sales and distribution department, which experienced a modest increase of 24 employees, bringing the total to 442.
The reduction in workforce coincided with a significant decline in EABL’s net profit, which plummeted by 21 per cent, landing at Ksh 12.32 billion compared to Ksh 15.57 billion in the previous fiscal year.
This sharp decline in profitability can be attributed to a combination of factors, including increased indirect taxes, rising costs of sales, and higher net finance costs.
This marks the first time in over seven years that EABL’s workforce has dipped below the 1,500-employee threshold. In 2017, the company boasted a headcount of 1,609 but subsequently shed 109 jobs over four years, reaching 1,500 in 2021.
However, the company experienced a brief uptick in employment in 2022, adding 76 jobs as its earnings more than doubled, surging from Ksh 6.96 billion to Ksh 15.57 billion due to a recovery from the disruptions caused by the COVID-19 pandemic.
The decision to reduce the workforce underscored the challenges EABL has faced in maintaining its financial performance amidst a volatile economic landscape and changing market dynamics.
The company has been navigating a complex environment characterized by increased taxation and operational costs, which have placed pressure on its profit margins.
In response to these challenges, EABL has undertaken strategic measures to optimize its operations and adapt to the evolving market conditions.
While job cuts are undoubtedly a difficult decision, they are part of the broader effort to ensure the long-term sustainability and competitiveness of the company.
EABL remains committed to delivering value to its shareholders and customers, and the company’s leadership has emphasized the importance of prudent financial management and operational efficiency in achieving this goal.
As the global business landscape continues to evolve, EABL is dedicated to adapting and innovating to maintain its position as a leading player in the beverage industry in East Africa.
The impact of these workforce changes and the company’s overall financial health will be closely monitored by stakeholders, including investors, employees, and the broader business community.
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