South Africa’s beer major SAB reports double digit growths in both sales, profit despite alcohol bans

SOUTH AFRICA – Despite the multiple COVID-19 related alcohol ban, South African Breweries (SAB) realised strong consumer demand for its brands when alcohol trade was allowed.

According to its parent company, Anheuser-Busch InBev (AB InBev) revealed that the beer maker registered double-digit growth in both profit and sales in the six months to end-June, a period which covered parts of two alcohol sales bans.

The third alcohol sales ban since the Covid-19 pandemic started, began in December and ended at the beginning of February, while the fourth ban started towards the end of June to end of July.

The growth is off a comparatively low base – in the first half of 2020 when SAB couldn’t sell its products between 27 March and 1 June due to the first alcohol sales ban, reports Fin 24.

The company saw strong demand for Carling Black Label, in particular, while in its premium segment, it highlighted an “ongoing healthy performance” from beer brands Corona and Stella Artois, and flavoured alcohol beverages Brutal Fruit and Flying Fish.

Overall, AB InBev managed to grow its group’s total volumes by 20.8%, while its underlying profit increased to US$1.5 billion from US$790 million in the second quarter of 2020.

South Africa is part of the group’s Europe, Middle East and Africa business, whose revenue grew by 44.2% and earnings increased by 137.8%.

“The consistent execution of our commercial strategy – centred on winning brands, category development and digital transformation – delivered continued momentum in the second quarter with top-line growth 3.2% ahead of 2Q19 pre-pandemic levels, even in light of ongoing Covid-19 impacts,” said Ab InBev’s new CEO Michel Doukeris.

 SAB was at the fore-front to call for the lift of the alcohol sales ban in the country to avoid a possible industry-wide collapse – which threatened the livelihood of millions of people supported by the sector and earnings by both the businesses and economy.

AB InBev’s overall volumes grew by 20.8% in the second quarter of 2020

Following the recent resumption of booze trade, the brewery has committed to ensuring that its traders and retailers are equipped in trading responsibly and with compliance.

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This will be done through its Responsible Trading Programme (RTP) – an initiative designed to address the issue of harmful alcohol consumption and mitigate COVID-19 transmission.

Kgosi Mogotsi, the Regional Corporate Affairs Director at SAB says, “It’s time that South African alcohol retailers lead by example. The Responsible Trading Programme (RTP) is the beginning of a new era for alcohol consumption country-wide.

“As SAB, we recognise the important role we play in ‘saving lives and livelihoods,’ by recognising and rewarding responsible outlets for serving as pillars within their communities.” 

The Responsible Trading Programme – which is modelled on international best practices and principles surrounding the serving of liquor – recognises alcohol traders and retailers for their efforts to encourage responsible drinking, particularly as South Africa is currently experiencing the “third wave” of COVID-19 infections.

Retailers will be assessed according to their level of compliance, which falls into three levels of certification, i.e., silver, gold and platinum.

Approximately 32 000 outlets across the country will undergo an audit. Piloting the programme in taverns, these outlets will be audited to check for compliance against liquor license and Covid19 regulations.

Outlets that show compliance in all the different certification levels, will be certified accordingly along with access to rewards from the participating manufacturers for the betterment of their outlets.

Outlets who do not pass the audits will be granted access to content that will inform tavern owners on what they are required to comply with by law, giving them the opportunity to close the gaps before the next audit.

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