While Diageo’s global profit fell 27.2% to $3.16 billion in the fiscal year ended June 30, dragged down by restructuring charges and softness in markets including the U.S., Africa, which is home to EABL, delivered the region’s strongest organic growth.

East African Breweries Limited (EABL) has reported a 49 per cent increase in net profit to KSh18.2 billion (about $1.12 billion) in the fiscal year ending 30 June 2026 despite a turbulent economic environment marked by currency volatility, geopolitical disruptions, and shifting consumer habits.

The results, announced Thursday in Nairobi, highlight the resilience of Africa’s beverage alcohol market, which served as a rare bright spot for the company’s British parent, Diageo.

While Diageo’s global reported operating profit slumped 27.2 per cent to $3.16 billion, weighed down by restructuring costs, impairment charges and weakness in key markets such as the U.S., the African continent delivered the strongest organic growth of any region.

East Africa’s ‘Broad-Based’ Momentum

EABL’s performance was underpinned by growth across all three of its core markets: Kenya, Uganda, and Tanzania. Net revenue climbed 13 per cent to KSh146 billion, marking the first time the Nairobi-listed brewer has surpassed the $1 billion revenue milestone.

Chief executive Jane Karuku described the year as one of the strongest in recent memory. Kenya, which contributes about 60 per cent of group revenues, grew by a solid mid-single-digit percentage. However, it was the regional operations that truly excelled; Uganda recorded a 16 per cent revenue increase, while Tanzania posted a sharp 44 per cent jump.

This regional diversification has become a key strategic asset for EABL, reducing its dependence on the Kenyan market and validating its long-term strategy of building a diversified East African footprint.

The Spirits and Beer Mix

EABL growth was driven by strong demand across both beer and spirits. The company benefited from a reform of Kenya’s excise tax regime, which industry players say has ended years of double taxation on alcoholic beverages and encouraged higher consumption volumes.

The mainstream spirits category was a standout performer, surging 30 per cent during the year. A significant driver of this growth was Kenya Cane, a mass market rum brand whose flavored variants such as ginger, pineapple and coconut have become staples in bars and entertainment venues across the region.

EABL’s premium beer and spirits offerings also grew by 9 per cent, reflecting a notable trend of premiumization even as consumers face financial pressure. The company’s “new frontiers” business, which features ready-to-drink cocktails and innovations such as Manyatta, grew 26 per cent, signaling a shift in consumer preferences toward new drinking occasions.

Operational Discipline and Balance Sheet Strength

Profitability was further bolstered by sharp reductions in financing costs. EABL reduced its total debt by KSh4.8 billion during the financial year, benefiting from a lower interest rate environment across East Africa. This deleveraging, combined with disciplined cost control and productivity improvements, helped the company navigate a KSh1.2 billion foreign exchange hit arising from the weakening of the Kenyan shilling against major currencies used for imports.

The strong operational performance has translated into significant shareholder returns. EABL’s share price increased by 43 per cent to close at KSh269, and the board has recommended a final dividend of KSh 8.70 per share. This brings the total annual dividend to KSh12.70, a 59 per cent increase compared to the previous financial year.

The South African Spark on Diageo Profit

While EABL’s performance in East Africa was exceptional, the broader Diageo Africa segment also saw strong contributions from its South, West, and Central Africa (SWC) operations.

According to Diageo’s regional review, SWC Africa achieved organic net sales growth of 15.2 per cent. The standout market was South Africa, where strong growth in ready-to-drink (RTD) products, particularly Smirnoff Ice, was fueled by increased focus, successful innovation, and a route-to-market transformation completed last year.

Asahi Group EABL Takeover

The record results come at a pivotal time for EABL. In December, Diageo agreed to sell its controlling stake in the company to Japan’s Asahi Group Holdings as part of a broader global portfolio realignment.

While the transaction, which is expected to reduce Diageo’s net debt, is on track to close in the second half of 2026, the change in ownership marks the end of decades of control by the London-based giant over one of East Africa’s largest listed companies.

As EABL prepares for a new chapter under Japanese ownership, its FY2026 performance demonstrates the underlying strength of its portfolio and the resilience of its East African markets.