Passing The Reins of an Iconic Portfolio

Outgoing GAB Managing Director Charles Ireland, who is leaving Malaysia for his next posting in East Africa on April 1, and Incoming GAB Managing Director Hans Essaadi discuss: 

- 11 years of unbroken profit, revenue and market share growth - challenges and opportunities; 

- Extent to which Hans is able to continue this streak - details of new business plan; 

- Operational KPIs: market share / volumes / revenue and profit growth: visibility, forecast - details; - Intricacies of running a successful malt liquor business in a multicultural society, multi-religious nation like Malaysia; 

- Competition from Carlsberg - successfully transformed into diversified offerings within the mid and high price ranges - issues; 

- Extent to which Hans' experience in business development, sales and brand marketing might protect or enhance GAB’s currently dominant position in the premium segment; 

- Operational challenges - rising materials prices - financial instruments - costs management; 

- Strategies to address inflationary pressures -- price increases - quantum and timetable; 

- Internal challenges: Project Quantum, the recent RM40m IT infrastructure investment - transparency - productivity and profitability; 

- Challenges @ Policy level - visibility - sense of regulatory risks through 2013; 

- Possibility of revamp of the current alcohol tax structure; 

- External issues - impact on the business - context of HQ needing more funds from profitable emerging markets from a dividend perspective; 

- Heineken winning control of Asia Pacific Breweries (the other JV partner to Diageo, in the entity that controls GAB in Malaysia)

- price said to be extremely high for the sector, at some 17 times EBITDA

- Justification for the hefty price tag; 

- Whether this puts more pressure (from HQ) on Hans to succeed; 

- Hans as a Heineken man -- Asian consumption patterns trending into premium beer products - strategy; 

- Growth estimates for premium beer in Asia-Pacific region; 

- Dividend policy issues - augment / retain  - visibility; 

Charles Ireland: next appointment as Group Managing Director of East African Breweries Limited (EABL), effective 1st April 2013:

EABL is East Africa's largest alcohol beverage company and the no. 1 on the Nairobi Stock Exchange, with Market Capitalisation of about USD 3 Billion. The business consists of 5 breweries and 2 spirits plants across 7 countries in East Africa including Kenya, Uganda and Tanzania. EABL’s total volume is 12m hectolitres – 10 times the volume of GAB. EABL has a total of 1800 employees.East African Breweries Limited (EABL) is a Kenya-based holding company, which manufactures branded alcoholic and non-alcoholic beverages. Along with its subsidiaries, the Company is involved in the marketing, brewing, manufacturing and selling of drinks, glass containers, malt and barley. EABL's core brands include, among others, Tusker, Pilsner, Bell Lager, Guinness, Malta Guinness, Alvaro, Uganda Waragi, Senator, Johnie Walker and Smirnoff Ice. The Company's wholly owned subsidiaries include Salopia Limited, Allsopps (EA) Sales Limited, East African Breweries (Mauritius) Limited, Central Glass Industries Limited, International Distillers Uganda Limited, East Africa Maltings Limited, East African Maltings (Uganda) Limited, EABL Tanzania Limited and EABL International Limited. The Company exports its products to Australia, Japan, the United States, Canada and the United Kingdom, among others. EABL is controlled by Diageo plc, United Kingdom. 

- From a management perspective - challenges of growing a company that is already arguably quite big; - Rescue job - track record: resignation of East African Breweries CEO Devlin Hainsworth (who quit his post following a 14% drop in its half-year net profit said to be due to acquisitions gone sour) - strategy.