ZAMBIA – In line with guidance from the Zambia government to combat the spread of coronavirus  (COVID-19), Zambian Breweries Plc has set a new milestone by becoming the first listed company on the Lusaka Securities Exchange (LuSE) to hold a virtual annual general meeting (AGM).

Country director Jose Moran said the company held the virtual meeting as directed by Government to restrict gatherings to not more than 50 people in a continuing effort to curb the spread of the epidemic.

During the AGM, the AB InBev subsidiary reported the annual financial statements for the year ended 31st December 2019.

According to the report, Zambian Breweries Plc has posted a 17% increase in revenue of K2.092 billion (US$114.8m) from K1.787 billion (US$98m) recorded in the previous year 2018.

The brewery earned a record breaking profit of K274.4 million (US$15m) a 27% rise from K216.6 million (US$11.8m) registered in 2018.

Announcing the results, Monica Musonda Chairperson of the company stated that, “It was a challenging year. However, despite operating in an increasingly tough environment marked by inflationary pressure, increased interest rates and exchange rate fluctuations among other things, overall performance of your Company remained strong.”

Despite the absence of carbonated soft drink in its production, the clear beer volumes reached record levels, with the brewer selling 2.3 million hectolitres, up 9% compared with 2018.

In 2018, Zambian Breweries finalised the sale of its Coca-Cola bottling business to Coca-Cola Beverages Africa (CCBA), setting it on course to focus on its clear beer business.

The growth in volume sales was driven primarily by superb performance of Eagle, Mosi Premium, Castle Lite and Carling Black Label lagers, as well as impressive growth in sales of imported Budweiser and Stella Artois.

However, clear beer variable production costs and distribution costs were up by 8% and 24% respectively.

This was due to the cost of greater volume, higher cost of foreign currency-dominated imported raw materials following the Kwacha devaluation and increased inter-depot transfers to balance volume demand.

This resulted in a clear beer gross margin above the 40% mark, representing an improvement of 25% against prior year results.

Some of the investments the company undertook in the year include the extension of the company’s flagship cassava project promoting commercialization of cassava farming.

Through the initiative they have provided market for over 729 verified cassava farmers on the block chain platform from Luapula, Northern and Muchinga provinces of Zambia.

In 2019 the brewer bought a capped volume of 1,933 tonnes of cassava, creating farmer incomes of K2.554 million (US$140,000) via mobile money direct transfer.