Hop at last: Tanzania Breweries sells dormant Darbrew unit

Hop at last: Tanzania Breweries sells dormant Darbrew unit

By JAMES ANYANZWA

Tanzania Breweries Ltd (TBL) Plc has completed the sale of its entire 60 percent stake in the beer manufacturing subsidiary Darbrew Ltd and launched a facelift of its production facility at Kibo Breweries Ltd as part of a turnaround plan for the struggling dormant units.

The Dar es Salaam Stock Exchange-listed brewer approved the sale of Darbrew Ltd to a core shareholder Dar es Salaam City Council (DCC) on August 7, 2019, due to the non-performance of the subsidiary, but the conclusion of the deal has been delayed for years on undisclosed reasons. 

The company disclosed in its 2023 annual report that the transaction was completed during the accounting period ended December 31, 2023, as the beer maker moved to shore up its cash flow position amid a cocktail of domestic and global factors, including a significant increase in the cost of production and overheads as a result of the global supply chain disruptions caused by the conflict in the Middle East and eastern Europe. 

Locally, the company was impacted by the significant increase in excise duty on raw materials used in the production of beer, exceptionally wet weather and load shedding by the utility, Tanzania Electric Supply Company Ltd (Tanesco).

“During the year, management executed the Board’s approved disposal of the Darbrew Ltd made on August 7, 2019. The disposal involved offloading 60 percent of the Company’s investment in Darbrew Ltd to Dar es Salaam City Council (DCC), a core shareholder. The sale was executed on May 2, 2024, where the Sale Agreement, Transfer of Share Deeds and other documentations including formal handovers to the DCC were completed,” the company says.

“Decision was made due to non-performance of the Darbew Ltd in its business. Darbrew Ltd remained a dormant operation, and as of December 31, 2023, the subsidiary was held for sale (discontinued operations).”

Advertisement

Kibo upgrade

On the other hand, TBL’s management opted to upgrade the production facility at Kibo Breweries after the subsidiary remained dormant throughout the year, despite a Tsh42.41 billion ($15.83 million) investment.

“Kibo Breweries remained dormant throughout the year. Management continues to upgrade the production facility of the entity and it expects the malting plant to be completed in the year 2024,” the company says.

“During the year, management performed an impairment assessment of its investment in Kibo Breweries Limited. No impairment allowance was recognised.”

Kilimanjaro plant

In July 2023, the group announced its decision to invest and upgrade the Kilimanjaro Malting Plant after halting operations for six years — since 2017 — due to insufficient local barley grown in the area. 

High water usage and electricity costs as well as outdated technology consuming too many resources prevented the plant from restarting.

The plant is projected to process about 10,000 tonnes of barley in the initial phase and scale up to 28,000 tonnes of barley, contributing significantly to Tanzania’s agricultural economy and enhancing the welfare of the barley farming communities.

The initial phase of the project is expected to be operational by the fourth quarter of 2024.
“We are committed to empowering farmers through advanced agricultural techniques, business and financial literacy, which will in turn increase the value chain and benefit farmers who grow barley, sorghum and grapes,” the company says.

TBL stakes

Currently, TBL procures 74 percent of its raw materials from within the country.

TBL Plc is 63.95 percent owned by Anheuser-Busch InBev (AB InBev), the world’s largest brewer with operations in over 50 markets and a presence in 15 African countries.

The company’s principal activities are the production, distribution and sale of malt beer, non-alcoholic malt beverages and alcoholic fruit beverages in Tanzania, and exports to Nile Breweries Ltd and Zambia Breweries Ltd, all subsidiaries of AB InBev.

TBL has a controlling interest (65 percent) in a spirituous liquor company, Tanzania Distilleries Ltd, and 60 percent in Darbrew Ltd.
It fully owns Kibo Breweries Ltd.

In 2023 the group’s cash generated from operations declined by nine percent to Tsh335.86 billion ($125.42 million), from Tsh368.82 billion ($137.73 million) in 2022.

A total of Tsh87.53 billion ($32.68 million) was capital expenditure during the year, compared with Tsh82.35 billion ($30.75 million) invested in 2022.

“A capital investment plan is in place to ensure the optimal operation of all breweries and distilling plant. The Group and Company have set plans to ensure production, sales and market share are increased, maintained and sustained in the near future,” the company says.

Original Media Source

Share this news

Facebook
Twitter
LinkedIn
WhatsApp

This Year's Most Read News Stories

Tanzania Confirms Outbreak of Marburg Virus Disease
Tanzania Foreign Investment News
Chief Editor

Tanzania Confirms Outbreak of Marburg Virus Disease

Dodoma — Tanzania today confirmed an outbreak of Marburg virus disease in the northwestern Kagera region after one case tested positive for the virus following investigations and laboratory analysis of suspected cases of the disease.

President of the Republic of Tanzania, Her Excellency Samia Suluhu Hassan, made the announcement during a press briefing alongside World Health Organization (WHO) Director-General, Dr Tedros Adhanom Ghebreyesus, in the country’s administrative capital Dodoma.

“Laboratory tests conducted in Kabaile Mobile Laboratory in Kagera and later confirmed in Dar es Salaam identified one patient as being infected with the Marburg virus. Fortunately, the remaining suspected patients tested negative,” the president said. “We have demonstrated in the past our ability to contain a similar outbreak and are determined to do the same this time around.”

A total of 25 suspected cases have been reported as of 20 January 2025, all of whom have tested negative and are currently under close follow-up, the president said. The cases have been reported in Biharamulo and Muleba districts in Kagera.

“We have resolved to reassure the general public in Tanzania and the international community as a whole of our collective determination to address the global health challenges, including the Marburg virus disease,” said H.E President Hassan.

WHO is supporting Tanzanian health authorities to enhance key outbreak control measures including disease surveillance, testing, treatment, infection prevention and control, case management, as well as increasing public awareness among communities to prevent further spread of the virus.

“WHO, working with its partners, is committed to supporting the government of Tanzania to bring the outbreak under control as soon as possible, and to build a healthier, safer, fairer future for all the people of Tanzania,” said Dr Tedros. “Now is a time for collaboration, and commitment, to protecting the health of all people in Tanzania, and the region, from the risks posed by this disease.”

Marburg virus disease is highly virulent and causes haemorrhagic fever. It belongs to the same family as the virus that causes Ebola virus disease. Illness caused by Marburg virus begins abruptly. Patients present with high fever, severe headache and severe malaise. They may develop severe haemorrhagic symptoms within seven days.

“The declaration by the president and the measures being taken by the government are crucial in addressing the threat of this disease at the local and national levels as well as preventing potential cross-border spread,” said Dr Matshidiso Moeti, WHO Regional Director for Africa. “Our priority is to support the government to rapidly scale up measures to effectively respond to this outbreak and safeguard the health of the population,”

Tanzania previously reported an outbreak of Marburg in March 2023 – the country’s first – in Kagera region, in which a total of nine cases (eight confirmed and one probable) and six deaths were reported, with a case fatality ratio of 67%.

In the African region, previous outbreaks and sporadic cases have been reported in Angola, the Democratic Republic of the Congo, Ghana, Kenya, Equatorial Guinea, Rwanda, South Africa and Uganda.

Marburg virus is transmitted to people from fruit bats and spreads among humans through direct contact with the bodily fluids of infected people, surfaces and materials. Although several promising candidate medical countermeasures are currently undergoing clinical trials, there is no licensed treatment or vaccine for effective management or prevention of Marburg virus disease. However, early access to treatment and supportive care – rehydration with oral or intravenous fluids – and treatment of specific symptoms, improve survival.

Source: allafrica.com

Continue Reading