Kenya’s biggest brewer, East African Breweries Limited (EABL), has reviewed the terms of existing contracts priced in foreign currency as part of attempts to minimise foreign exchange (forex) losses in the Kenyan market in the first six months of 2023.
Although the revision of the contracts – mainly for raw materials sourced outside the county – came at a marginal extra cost, it saved the brewer from experiencing bigger forex losses in the full financial year that ended in June 2023.
Without the revisions, the forex impact could have eaten into EABL’s earnings beyond the 2.1% cost recorded. The drinks manufacturer’s earnings before interest and taxes stood at KSh28.3bn ($197m) by the end of June.
We don’t have any foreign currency exposure in our balance sheet
With this strategy in place, EABL says it is now sitting on significant forex reserves – enough to support its upcoming
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