evolving our
chairperson’s STATEMENT
purpose
Dear stakeholders
This integrated report looks back on a very successful year that stands out for its strong and rewarding partnerships. They form the core theme and reporting framework for this report, and bring a positive outlook for Namibia Breweries Limited (NBL) in the longer term, despite many challenges in our markets and country.
NBL remains a star performer among the O&L Group as is evident by international recognition for the quality of its brands, people practices and transformation initiatives. NBL was recognised as one of the leaders in the promotion of Employment Equity in Namibia and awarded the Overall Top Performer in the Workplace category by the Employment Equity Commission of Namibia. NBL was also crowned the overall winner of the category ‘Best Plant Information Management System Application’ at an international software conference held in South Africa during May 2016.
NBL delivered excellent financial results for the year with turnover increasing by an average of 12.3% over the past five years. Operating profit for the year was N$34 million higher than the previous year, which was N$507 million. Return on assets was 31.4% whereas the return on ordinary shareholders’ funds increased to 32.4% (2015: 26.2%). The Board believes the Company remains in a healthy position with good growth prospects.
Evolving our purpose through partnerships
The O&L Group has been on a journey to formulate and refine its purpose for more than six years. At the time of developing the Group’s vision, the global financial crisis, among other factors, made us realise that our purpose is more important than our pockets: we agreed that we want to create a sustainable future.
Our purpose, Creating a Future, Enhancing Life, means that everyone in the Group works differently to six years ago. People now understand their individual and personal purpose and how this aligns to what we want to achieve as a business. Our philosophy is to see our employees as our most important asset. As a result, our employees come to work to achieve something, rather than only to receive a salary.
Our purpose is at the root of our approach to partnerships. We create partnerships with people and institutions that can relate to our purpose and our values – and that can help us achieve Vision 2019.
Our targets for the Group’s Vision 2019 are to
- reach a N$2 billion earnings before interest and tax (EBIT) target;
- reduce our carbon footprint by 20%;
- remain an Employer of Choice; and
- create 4 000 additional job opportunities.
NBL has made impressive contributions to these Group targets during the year.
Read more about these in the Managing Director’s Report.
Partnership highlights
Our purpose-driven partnership approach fosters the Group’s relationship with Government. O&L subsidiaries engage with Government on their own and collectively through a range of departments and projects. On a personal level, I have played a strategic role in developing and building the Development Bank of Namibia, the National Planning Commission, the Namibian Broadcasting Corporation and other public and private institutions.
As a true Namibian corporate citizen NBL remains committed to Government’s vision of the “Growth at Home” strategy, the Harambee Prosperity Plan and ultimately Vision 2030. The launch of the new King Lager beer and commercialisation of the local barley industry is a worthy example of our commitment.
The strategic restructuring of NBL’s joint venture in South Africa was also a milestone for 2016. There is a shared commercial vision between NBL and Heineken for the future – starting in South Africa and with long‑term opportunities in other markets.
Group commitments
O&L remains the controlling shareholder of NBL, providing shared services, offering synergy and new growth opportunities. We will continue to identify and invest in business opportunities in Namibia and beyond that will grow shareholder value, both short and long term, in line with the Group’s Vision 2019.
We are committed to the development of human capital – leadership and individuals with purpose – for Namibia at large. During the past year we continued the Mwenyopaleka programme, which encourages employees to move away from a rule-driven employment relationship to a value-driven one based on long‑term commitment.
With the current water crisis in Namibia, NBL continues to execute its water mitigation plan to reduce dependency on public water resources, thereby contributing to the sustainability of our economy. This includes investment into boreholes, volume migration to South Africa, a water reclamation and pretreatment plant.
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NBL was recognised as one of the leaders in the promotion of Employment Equity in Namibia and awarded the Overall Top Performer in the Workplace category by the Employment Equity Commission of Namibia |
N$541 million
(
6.7%)
31.4%
(
1.2%)
32.4%
( 23.7%)
We are also continuously increasing our support to local procurement partners to further develop the Namibian economy and mitigate foreign exchange exposure.
Although NBL is actively diversifying into other beer and beverage offerings, we remain committed to upholding the Reinheitsgebot for our core products: using only three ingredients, namely malted barley, hops and water.
Our support of self-regulating measures to encourage responsible drinking and prevent alcohol harm remains an important focus area.
Read more about our responsible drinking initiatives.
Good corporate governance
Governance remains structured and integrated to be compliant, effective and to provide the Senior Leadership Team with the support to execute our O&L Group strategy. To create a breakthrough culture we have to start from the top, by empowering people with purpose.
There were several resignations from the Board following the restructuring of the South African joint venture. Sijbe Hiemstra resigned on 12 November 2015 after just more than four years on the Board, and Nick Blazquez, Philip Jenkins, Martin Kromat and Jeff Milliken all resigned on 1 December 2015.
Nick was a Board member for almost 12 years, whereas the others joined us more recently. They each made unique and much appreciated contributions to NBL and helped fostered partnerships for the future. We wish them all the best.
Dividend for 2016
The Board continues maintaining a balance between the interests of business, shareholders and other stakeholders. We have therefore adopted a progressive dividend policy which aims to maintain or grow the dividend each year. A full year dividend of 40 cents per ordinary share was declared for shareholders registered on 21 October 2016 and will be paid on 11 November 2016.
Appreciation
I would like to thank all our employees for their contribution in the past year – every single one of you played a role in our results. This extends also to our suppliers, consumers and loyal customers, who form a critical part of our success story over many years.
Lastly, I would like to thank my fellow Board members, the O&L Group Executive and our Senior Leadership Team for their commitment to, ownership of and passion for NBL.
