Bralirwa ends year with new lime-flavoured beer
Friday December 22 2017
The brewer launched the first and only locally-brewed flavoured beer in the market. The firm has faced a challenging year due to a competitive business environment. PHOTO FILE | NATION
Bralirwa — Rwanda’s biggest brewer — has added to its product with Primus Citron, in a move the company says is in response to evolving consumer needs.
The new product comes a year after the brewer launched Mutzig Lite, a low alcoholic content version of the classic Mutzig beer.
“The new beer is one way the company is showing its commitment to the ever evolving consumer needs,” said the Primus brand manager, Vanessa Nshimirimana.
“Primus Citron is the first and only locally-brewed flavoured beer in the market,” she said.
Despite Bralirwa being the market leader, the brewer has faced a challenging year.
Bralirwa increased retail prices for its mainstream beer portfolio, which has proved costly. The move was driven by a need to counter currency losses from servicing a dollar-denominated loan at a time when the Rwandan Franc was depreciating rapidly.
However, the Heineken intercompany loan, which had piled pressure on the brewer in the past few yeas has been restructured and is now denominated in Rwandan francs instead of US dollars to reduce the forex impact on net finance cost.
Primus 33cl increased to Rwf400 ($0.47), Primus 50cl to Rwf600 ($0.70), Primus 72cl Rwf800 ($0.94), Turbo King 33cl Rwf500 ($0.58), Turbo King 50cl Rwf700 ($0.82), Legend 30cl Rwf600 ($0.70) while Amstel 33cl increased to Rwf700 ($0.47).
Falling numbers
Recent results released on the company’s website show total consumed volumes decreased by 15.4 per cent, while organic revenue declined by 3.8 per cent mainly due to the beer price increases.
“Due to a challenging operating environment we limited the impact on results through price and mix management, as well as a strong cost focus. Volume was adversely impacted by our price increase in the mainstream beer segment,” said Victor Madiela, the vice chairman of the Board and managing director of Bralirwa.
Mr Madiela said investments in the business had now normalised after the conclusion of a five-year investment programme last year.
“Leveraging these investments has enabled us to further optimise production costs, and this combined with our ambitious cost management programme contributed positively to the bottom line,” he said.
Revenue declined by 3.8 per cent to Rwf41.3 billion ($48.3 million) in the first half of the year from Rwf43.0 billion ($50.3 million) in the first half year of 2016.
Although the statement shows a 20.7 per cent increase in results from operating activities as a result of strict management, it also mentions that, “The business environment remains challenging and competitive.”
READ: Bralirwa, Crystal Telecom profits drop
Competition
The strengthening of Unibr-owned Skol with its signature brand Skol Lager and its newer premier brands like Gatanu, Virunga Mist and a new non-alcoholic drink called Panaché, has increased competition in the beer segment.
Other beer imports from Uganda, Kenya and Burundi have been steadily eating into Bralirwa’s share.
Global whisky and liquor manufacturers like Pernod Ricard are gaining a foothold in the local market, with products like Jameson, Absolut Vodka, Chivas among others appealing to the middle class consumers.
These global brands are marketed through local distributors like Tianis who has mounted a vigorous social media marketing drive that seems to be paying off.
Bralirwa’s profit and total comprehensive income for the first half of the year grew by 249.1 per cent from Rwf0.6 billion ($702,000) to Rwf2.1 billion ($2.4 million), which resulted in earnings per share of Rwf2.03. The company says it expects further challenges as the year closes given cost pressures and constrained consumer spending.
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