Water-stressed NBL to lobby industry peers
Brewer wants to utilise boreholes extensively
Namibia Breweries Limited says it needs to fully utilise its boreholes to alleviate the pressure on NamWater and the City of Windhoek, amid critical water shortages.
Namibia Breweries Limited (NBL) says the only way it will be able to put less pressure on the limited water supplies within the central areas of the country is if it is allowed to fully utilise its existing boreholes.
NBL is currently only able to utilise 20% of the capacity of its boreholes, and said full utilisation will see it move its dependency away from bulk water supplier NamWater, as well as the City of Windhoek.
“We have our own local boreholes. If we could utilise our boreholes fully, we would not have any impact on the water shortage. The challenge we have is through NamWater [and] the municipality. We are only allowed to take 20% from our boreholes. That is the big conversation we are having,” NBL CEO Peter Simons said.
The brewer now intends to lobby its industry peers with a view to change the government’s stance, and that of NamWater, as water supply pressures continue to mount.
“I am as worried about the water situation as everybody else, so we are talking to our business partners, we are talking to government, we are talking to NamWater... But one solution for us is very clear, give us the opportunity to leverage more, and that is the application we sent,” he said.
Windhoek declares water emergency
The City of Windhoek recently declared a Category C water scarcity, as guided by its water demand management plan of May 2023.
This requires residents to cut down on 10% of their water usage for the available water to further sustain the central areas.
“Should we fail to meet our 10% water-saving target in this category, the next category, according to our water demand management plan, is severe scarcity, which imposes more severe restrictions in terms of water usage,” the City said in a statement.
Brewer meeting competition commission requirements
NBL, which was acquired by Dutch brewer Heineken last year, has been required by the Namibia Competition Commission (NaCC) to move its production of cider products locally. This after Heineken’s acquisition involved the Distell Brewing Company, which produces the Savanna cider brand, and the Richelieu brandy brand.
Simons said the company was fulfilling the conditions set by the NaCC.
“We have to land cider production within three years, that is well on hand. We are at the stage where we commissioning and testing,” he said.
“The conditions are in place for five years. We need to report on them, that is well in progress,” he added.
The numbers
Despite a decline in beer sales by 13.7% due to challenging economic conditions, NBL’s net revenue increased by 15% to N$2.1 billion. This is because of the successful integration of the Distell portfolio, which performed well year-on-year, and a price increase to cover inflation.
NBL placed significant focus on cash management over the last six months. This came on the back of obtaining additional financing to acquire Distell, which placed specific focus on effectively gearing NBL’s financial position and leveraging the expanded portfolio to optimise cash-generation in the short-term. Net cash flow from operating activities increased to N$482 million from N$199 million the previous year.
NBL is currently only able to utilise 20% of the capacity of its boreholes, and said full utilisation will see it move its dependency away from bulk water supplier NamWater, as well as the City of Windhoek.
“We have our own local boreholes. If we could utilise our boreholes fully, we would not have any impact on the water shortage. The challenge we have is through NamWater [and] the municipality. We are only allowed to take 20% from our boreholes. That is the big conversation we are having,” NBL CEO Peter Simons said.
The brewer now intends to lobby its industry peers with a view to change the government’s stance, and that of NamWater, as water supply pressures continue to mount.
“I am as worried about the water situation as everybody else, so we are talking to our business partners, we are talking to government, we are talking to NamWater... But one solution for us is very clear, give us the opportunity to leverage more, and that is the application we sent,” he said.
Windhoek declares water emergency
The City of Windhoek recently declared a Category C water scarcity, as guided by its water demand management plan of May 2023.
This requires residents to cut down on 10% of their water usage for the available water to further sustain the central areas.
“Should we fail to meet our 10% water-saving target in this category, the next category, according to our water demand management plan, is severe scarcity, which imposes more severe restrictions in terms of water usage,” the City said in a statement.
Brewer meeting competition commission requirements
NBL, which was acquired by Dutch brewer Heineken last year, has been required by the Namibia Competition Commission (NaCC) to move its production of cider products locally. This after Heineken’s acquisition involved the Distell Brewing Company, which produces the Savanna cider brand, and the Richelieu brandy brand.
Simons said the company was fulfilling the conditions set by the NaCC.
“We have to land cider production within three years, that is well on hand. We are at the stage where we commissioning and testing,” he said.
“The conditions are in place for five years. We need to report on them, that is well in progress,” he added.
The numbers
Despite a decline in beer sales by 13.7% due to challenging economic conditions, NBL’s net revenue increased by 15% to N$2.1 billion. This is because of the successful integration of the Distell portfolio, which performed well year-on-year, and a price increase to cover inflation.
NBL placed significant focus on cash management over the last six months. This came on the back of obtaining additional financing to acquire Distell, which placed specific focus on effectively gearing NBL’s financial position and leveraging the expanded portfolio to optimise cash-generation in the short-term. Net cash flow from operating activities increased to N$482 million from N$199 million the previous year.
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