Bralirwa Limited (Rwanda) – FY 2021 results conference call presentation

By Published On: June 8th, 2022Categories: Corporate announcement, Earnings

Bralirwa Limited (BLR.rw) 2021 Presentation

Disclaimer

This presentation contains forward looking statements with regard to the financial position and results of Bralirwa’s activities. These forward-looking statements are subject to risks and uncertainties that could cause actual results todiffer materially from those expressed in the forward-looking statements.

Many of these risks and uncertainties relate to factors that are beyond Bralirwa’s ability to control or estimate precisely, such as future market and economic conditions, the behavior of other market participants, changes in consumer preferences, costs of raw materials, interest rate and foreign exchange fluctuations, change in tax rates, changes in law, changes in pension costs, the actions of government regulators and weather conditions. Those and other risk factors are detailed in Bralirwa’s publicly filed annual reports.

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as the date of this presentation. Bralirwa Plc does not undertake any obligation to publicly release any revisions to these forward statements to reflect events or circumstances after the date of these materials.

2021 Rwanda Macroeconomic context

COVID-19 pandemic has affected the economic performance of the East Africa Community (EAC) however in 2021 the EAC countries recovered after a contraction in 2020 due to the impact of COVID-19 and subsequent lockdowns. The EAC projected a GDP growth of 6.5% while the Rwandan GDP increased by 10.9 % in 2021.

  • Inflation dropped to 0.8% in 2021 from 7.7% in 2020
  • Trade deficit deteriorated by 3.7%
    • Export of goods increased by 53.4%
    • Imports of goods increased by 16.5%
  • The RwF depreciated by 3.8% against the USD and it appreciated by 4.4% against the Euro.

Rwanda: beer market overview

  • Overall beer and soft drinks market remain very competitive with additional capacity in the market both from competitors and imports.
  • Notwithstanding the above the beer market in Rwanda continued to show strong growth despite the impact of the COVID-19 pandemic.
  • Consumer spending power remains constrained
  • The price increase in December 2020 combined with COVID-19 uncertainty, affected the performance of Primus brand and translated in the decrease of volume and market share. However, more activities were done to get closer to the consumer such as Iwacu Muzika, PNL and the signing of a local musical artist as Brand Ambassador.
  • Very strong Mützig performance led by 33cl hero SKU, supported by ‘Live Bold – Never stop starting’ campaign
  • In 2021, we extended Amstel proposal with a draught beer making Amstel the second beer brand to propose that SKU in the market. End of 2021, Amstel became the proud official sponsor of Tour du Rwanda.
  • Heineken® kicked 0ff UCL campaign to drive brand power by association with a favorite consumers pass time , Footbal and continue to drive the premiumness of the Heineken brand and continuous its ‘Enjoy Heineken Responsibly’ communication.

2021 FY Key Highlights

  • Total volume increased by 9.6% :
  • Beer volume increased by 7.5 % versus last year as a result of continued re-opening of the market as COVID-19 measures were relaxed. This was supported by consistent focus on Off-trade and On-Trade channels (Boutiques, Mini Markets, Supermarkets and on trade restaurants).
  • Soft Drink volume increased by 17.7% versus last year also driven by continued relaxation of measures against the spread of COVID-19 coupled with the revamp of the non-alcoholic beverages route-to-consumer.
  • Revenue increased by 15.4% versus last year mainly due volume growth coupled with better mix from growth of premium products.
  • Results from operating activities increased by 57.4% compared to 2020 driven by efficiency in operations, cost saving initiatives and increase of the top line.
  • Net finance cost decreased by 18.2% to Rwf 5.5 billion in 2021.
  • Profit and total comprehensive income increased by 94.6% to Rwf 17.5 billion (2020: Rwf 9 billion), due to the reasons above. This resulted in better earnings per share of Rwf 17.03 (2020:Rwf 8.75).

Sustainability and Responsibility at the heart of our Business

Covid-19 response support
• In the fight against Covid-19, Heineken Africa Foundation supported Rwandan Government through WaterAid with EUR 200,000 in 2021 to
cater for WASH programs.
• To our employees, Bralirwa continuously provided masks. Environment protect 20,000 fruit and agroforestry trees donated to Rubavu District to promote environmental conservation.

Local sourcing
In collaboration with Rwanda Agriculture Board (RAB), we took part in barley trials in Musanze District, Northern Province. These barley trials will benefit farmers by providing extra income.

2022 Full Year Outlook

  • Ongoing uncertainties and resulting volatility in the global economy are expected to continue to impact African economies in the coming year.
  • Our plan for 2022 is to further drive top line, profit and margin growth in this new reality as we expect the Rwandan economy to bounce back driven by the government’s relentless effort to resume major infrastructure development projects, further relaxation of the COVID-19 measures in preparation for the 2022 CHOGM while it creates space to attract new FDI to Rwanda.
  • We stay conscious that COVID-19 continues to present an unprecedented health crisis and macro- economic risk, which is likely to have a significant impact on the economy and our business in the short term while we stay optimistic with the Government’s effort to roll-out vaccines that we expect to further reduce new COVID-19 cases here in Rwanda. The Rwandan franc has been depreciating since the outbreak of the pandemic and the continuous rise in global inflation rates in 2022 represents a major challenge to the Rwandan economy and to our business.
  • As always, our priority is the safety and health of our employees & their families, customers, consumers and other stakeholders. We will continue our role in playing a constructive role supporting the government as they work to contain the spread of the virus.