Tbilisi (GBC) - Georgia Capital's (GCAP) beer business gross revenues increased by 9.0% y-o-y to GEL 41.0 million in 3Q23 and was up by 21.9% y-o-y to GEL 108.6 million in 9M23, resulting from the strong recovery in tourism and increased product prices due to higher demand. Beer y-o-y sales (in hectolitres) were up 0.6% in 3Q23 (up by 7.1% y-o-y in 9M23). The average 3Q23 GEL price per litre (average for beer and lemonade) increased by 11.4% y-o-y (up by 9.7% in 9M23). The operating expenses were down by 29.8% and 29.4% y-o-y in 3Q23 and 9M23, deriving from the structural changes across beer and distribution business lines.
Consequently, the EBITDA of the business increased by 12.7% y-o-y and stood at GEL 7.9 million in 3Q23 (up 27.1% y-o-y to GEL 18.2 million in 9M23). The beer business produces beer and lemonade and holds a ten-year exclusive license from Heineken to produce and sell Heineken beer brands in Georgia. The beer business had c.22% market share in 2022. The business’ brands include Heineken, ICY (its flagship mainstream beer brand), Black Lion (the leading Georgian craft beer producer which the Group acquired in 2018), Kazbegi, which was acquired in 2019, Amstel and Krusovice beer, for which the business acquired a licence in 2019, and Kayaki (the Group’s light beer brand).
In 2019, the business received a licence to brew commercial batches of Heineken, and locally brewed Heineken beer has been available in stores since August 2019. Starting from the second half of 2019, the beer business relaunched its brands and improved its product mix, which helped it to increase its share in the beer market and allowed the business to achieve break-even EBITDA in the second half of 2019 and positive EBITDA in 2021 and 2022. The business also started to export its beer and lemonade brands to the international markets.
