2024 EABL Annual Report

OPERATING ENVIRONMENT

In Kenya, we navigated a tough landscape characterised by high interest rates, fluctuations in exchange rates, social and climate disruptions. Additionally, rising taxes impacted consumers disposable income and led to spend reprioritisation. Despite these headwinds, our flagship brands delivered strong growth, and we accelerated our innovations to meet evolving consumer preferences.

In Uganda, the political stability over the past year has been a key factor in supporting the country's economic

recovery, creating a more favourable environment

for business operations. However, headwinds such

as consumer downtrading due to macroeconomic challenges have put pressure on topline, necessitating careful financial management and pricing strategies.

Tanzania has presented both opportunities and challenges for EABL in the past year. On one hand, the market oers significant growth potential due to its young population and rising middle class, which drives demand. However,

regulatory challenges and economic uncertainty, including currency fluctuations and availability as well as inflation, has impacted consumer spending and posed risks to revenue stability.

PERFORMANCE OVERVIEW

EABL has demonstrated resilience and strategic agility, achieving strong results on the back of these hurdles. We posted a strong revenue growth of 13%, with operating

profit growth, excluding foreign exchange (FX), of 10%. EABL's profit after tax declined by 10%. This was mainly impacted by currency devaluation and significant increases in finance costs. Our improved cash generation from our operations helped expand our cash position to Kshs 10.8 billion; an increase of Kshs 1.8 billion compared to last year.

The Board of Directors has recommended a final dividend of Kshs 6.00 per share, bringing the total dividend to Kshs

7.00 per share increasing from Kshs 5.50 in FY2022/23, reflecting our commitment to delivering value to our investors, shareholders and customers.

SUSTAINABILITY

EABL continued to prioritise our 10-year sustainability action plan Society 2030: Spirit of Progress as a core element of our business strategy, recognising its critical role in securing the long-term success of our operations and the communities we serve. We made significant strides in our environmental stewardship, particularly in water conservation, renewable energy, and waste management.

Our investments in the Biomass Steam Plants and water eciency projects have not only reduced our carbon

footprint but also enhanced our resilience against resource scarcity. KBL's Project Rudisha has made great strides in promoting our Grain to Glass sustainability pillar through eective waste management and recycling. We are proud to have collected over 17 million spirit bottles in the past year, underscoring our dedication to reducing our carbon footprint and supporting the circular economy. Moreover, our commitment to sustainable agriculture has seen us deepen partnerships with our 60,000 local farmers, promoting responsible sourcing and supporting livelihoods across our supply chain.

These initiatives align with our ambition to create shared value, ensuring that our growth contributes positively to society and the environment.

CORPORATE GOVERNANCE AND BOARD CHANGES

Our corporate governance framework continues to be robust, ensuring that we operate with integrity, transparency, and accountability. During the period, the Board focused on guiding the Company through the turbulent environment and mitigate emerging risks to deliver shareholder value.

The Board is pleased to welcome Mr. Paul D. Makanza with eect from 2 June 2024 whose extensive experience in the service and manufacturing sectors will enhance our leadership and drive our growth ambitions. We also extend our deepest gratitude to Mr. John Ulanga, who resigned this fiscal year after serving as Chairman of Serengeti Breweries Limited.

Despite the ongoing volatility, the fundamentals of our business remain attractive, and we are well-placed to realise its potential. The past year's performance demonstrates the solid platform we have built to enable us to navigate the volatility in the short and medium term as well as deliver future growth. Our deep consumer insights and sustained investment across our strategic imperatives is fundamental to supporting performance for the future.

The Board and leadership team remain focussed on

securing long-term, sustainable value creation, by

nurturing EABL's culture, building our brands, and delivering against our strategy.

I thank our Group MD and CEO, Jane, and her wider team for their dedication, agility, and skilled execution of our strategy, resulting in positive returns to our stakeholders. Additionally, thanks also go to my colleagues on the Board, whose skills and diligent work have added exceptional value to the Company. I also wish to recognise and celebrate our partners, customers, consumers, suppliers, agencies, and Governments in the respective countries where we operate.

Finally, I would like to thank you for engaging with our organisation by reading our 2024 Integrated Report. We aim for this document to clearly and eectively communicate the scope of value that we, at EABL, bring to stakeholders and society through our operations and active sustainability progress.

DR. MARTIN ODUOR-OTIENO, CBS

GROUP CHAIRMAN