South African Breweries (SAB) has decided not to invest R2.5 billion in its annual capital and infrastructure upgrade programme for 2020, due to ban of alchol which harmed their production.
SAB alluded that this is impact of the Covid-19 lockdown induced ban on liquor sales for the past 12 weeks.
This far it has effectively lost 30% of its annual production since the start of national lockdown.
SAB deputy president of finance Andrew Murray said the company has been hard hit by the lockdown and its strict regulation on the sale of alcohol.
“This decision is a result of the first, and current, suspension of alcohol sales which has led to significant operating uncertainty for ourselves, our partners,” they said.
In addition, as well as their colleagues in the industry, including participants in the entire value chain, and which impacted over one million livelihoods across the country.
Initially, SAB had planned to invest R5-billion over the next two years.
However, the R2.5-million intended expenditure for the next financial year remains under review, due to ban of alcohol.
It would includes investments that were being considered included upgrades to operating facilities and systems, as well as the installation of new equipment at selected plants.
“This decision will also have an impact on the external supply chain companies that had been selected for these upgrades,” SAB says.