Companies

EABL net profit drops 37.9pc

eabl

EABL’s factory. East African Breweries (EABL) has recorded a 37.9 per cent drop in profit after tax for the full year ended June to Sh6.9 billion

East African Breweries (EABL) has recorded a 37.9 per cent drop in profit after tax for the full year ended June to Sh6.9 billion

The brewer, which is controlled by Britain's Diageo Plc, had in July warned that its net profit would drop by more than 25 per cent, due to higher financing costs related to an acquisition.

“This is principally due to the borrowings of Sh19.5 billion taken in November 2011 to enable EABL purchase a 20 per cent shareholding in Kenya Breweries Limited from SAB Miller Africa B.V, making KBL a wholly-owned subsidiary of EABL,” said a statement by EABL when it issued the profit warning.

EABL’s share price has recently been on a consistent decline, closing at Sh305 on Thursday, a 13 per cent drop from Sh349, the July 30 price when it issued a profit warning.