Rwandan brewer Bralirwa has reported a profit growth of $4.3 million for the year ending December 2017.
But for the second year running, the Rwanda Stock Exchange-listed company reported a decline in its beers and soft drinks sales volumes and revenues.
In its 2017 financial results released on Monday, Bralirwa reported a Rwf5.1 billion ($5.9 million) net profit, compared with Rwf1.4 billion ($1.6 million) in 2016.
The management said that a combination of measures, including cutting costs and introducing new products helped the company post a profit and an increased dividend payout to shareholders.
The board proposed a dividend of Rwf3.75 ($0.004) per share, up from Rwf1 ($0.0012) in 2016.
At the bourse, the company’s share price has appreciated to Rwf150 ($0.17) from Rwf123 ($0.14) in 2016.
The share price gain has boosted Bralirwa’s market value to Rwf77 billion ($88.7 million), from Rwf72 billion ($83 million) in 2016.
But analysts say that the Rwandan beer, spirits and soft drinks sector is facing its greatest challenge yet, with increasingly competitive products flooding the small market which will maintain pressure on Bralirwa’s earnings.
“The market remains very competitive and consumer spending constrained,” said Victor Madiela, Bralirwa general manager.
Rwanda has continued to attract local, international and regional soft drinks, beers and spirits makers who have either set up distribution points in Kigali or started manufacturing plants.
Bralirwa’s sales declined by 222,000 hectolitres, from 1,784,000 hectolitres in 2016 to 1,562,000 last year, and management projects a tougher prospect in 2018 as competition heightens and fewer units are sold.
Its lowest sales level was 1,650,000 hectolitres in 2013.
East Africa Breweries Limited, which has been in the country for the past three years, is the third largest player in the beer market. Analysts estimate that EABL controls 5 per cent of the Rwandan beer market.
Mr Madiela also cited the high costs of imported raw materials as impacting negatively on cost of production.