Uganda Breweries delivers resilient performance in difficult conditions

Uganda Breweries Limited has demonstrated a remarkable 33% increase in net sales despite a challenging year for the beverages sector. The company's Managing Director Alvin Mbugua recently sat down with CNBC Africa to discuss how UBL has navigated through difficult conditions and capitalized on new opportunities. Mbugua highlighted the impact of the COVID-19 pandemic on the company's operations, emphasizing how it served as a business accelerator in various aspects. The pandemic prompted UBL to expedite projects related to e-commerce, digital commerce, omnichannel selling, and home delivery models, which traditionally would have taken years to implement. This agility and innovation allowed UBL to grow its volumes and expand its reach through off-trade channels, even as consumer preferences shifted. Notably, Mbugua emphasized that 92% of UBL's brands are made from local raw materials, underscoring the company's commitment to supporting local farmers and communities. The investments made in sourcing locally have not only strengthened UBL's supply chain resilience but have also led to a 30% increase in engagement with farming communities. This focus on sustainability and local sourcing has positioned UBL for continued success in the future. Looking ahead, Mbugua discussed key trends that are reshaping the global beverages market. He emphasized the growing importance of in-home consumption and 'connection spaces' where consumers can gather with friends and family. The shift towards more informal and personalized drinking occasions is expected to drive demand for innovative products and delivery models. Mbugua also highlighted the trend towards formalizing the beverages sector, noting that there is a significant opportunity to transition informal consumption to formal channels. Additionally, he pointed to the rise of low-alcohol beverages and ready-to-drink options as key drivers of future growth. As UBL explores expansion opportunities, Mbugua discussed the company's investment plans in technology, production capacity, and value chain development. He underscored the importance of building brands that stand for values such as inclusion, diversity, and sustainability. Mbugua expressed UBL's commitment to being a transparent and ethical employer while driving growth and innovation across East Africa. The company's recent capital investments and strategic initiatives reflect its dedication to building a purpose-driven business that resonates with consumers and contributes to the African narrative. With a focus on long-term sustainability and cultural relevance, Uganda Breweries Limited is poised to lead the way in the evolving beverages industry.