Rwanda’s largest brewery, Bralirwa, reported strong performance in 2010 with net income growing by 62.8 percent, beating analysts’ expectations and generating optimism on the Rwanda Stock Exchange (RSE) ahead of this year’s planned listings.
Bralirwa’s net profits rose to Rwf10.3 billion in 2010, up from Rwf6.34 billion in 20009, the company said in its annual report for the financial year ended December 31, 2010.
Its directors also proposed that the company offers 100 percent of its net profit to shareholders in dividends.
“By any standards, this is very good for a company that is still expanding,” Celestin Rwabukumba, the Operations Manager said, adding that the performance was beyond their expectations.
He said the market was responding to the news positively as investors were bargaining for the best deals since they were anticipating dividends.
Yesterday Bralirwa shares performed strongly, rising by Rwf21 to close trading at Rwf228.
The RSE said that, overall, Bralirwa shares rose by 11.2 percent in value, one of the highest rises in the brewery’s share prices since its January 31, 2011 debut in the stock exchange.
Rwabukumba said that the perception of local investors about the RSE is now positive because of its transparency, something likely to influence future Initial Public Offerings (IPOs).
“It does provide serious confidence in the market and it is likely to influence other companies that may want to list,” he said.
The Minister of Finance, John Rwangombwa recently said that government plans to raise Rwf25 billion through the sale of its shares in Bank of Kigali (BK) and MTN Rwanda to increase domestic revenues.
Bralirwa was the first domestic company to undertake an Initial Public Offering (IPO) as part of government’s strategy to implement its privatisation programme through the capital markets to support the growth of the country’s stock market.
Jean Paul Van Hollebeke, Bralirwa’s Chairman of the Board of Directors said that over the period 2007-2010, the company achieved compounded average growth in net profit of 56.1 percent, demonstrating the successful implementation of strategic initiatives.
A strong operational focus on top line growth and disciplined cost management, combined with a favourable economic environment and the consistent implementation of constructive government policies drove a robust profit, he said
“Bralirwa was able to deliver the strong performance owing to a continuous focus on our core values, the talent and commitment of our people, the strength of our brands, the partnerships with our distributors and our ambition to continue to lead the market and promote profitable future growth.”