Sabeco cuts profit by a fifth
A corner of the beer transport sysm at Sabeco. — VNA/VNS Photo Công Thử
HCM CITY – Saigon Beer-Alcohol-Beverave Corporation (Sabeco) is targeting a lower post-tax profit in 二0 一 八 due to the increase of production costs and stronger competitiveness in the industry.
Its management board said at the company’s annual shareholder meeting on Saturday that it had cut its projected post-tax profit by 一 九 per cent year on year to VNĐ 四 trillion (US$ 一 七 八 million) in 二0 一 八.
Its total revenue is forecast at VNĐ 三 六 trillion in 二0 一 八, up 二. 四 per cent from 二0 一 七, and a 三 五 per cent dividend payout, level to the previous year.
In 二0 一 七, the company recorded VNĐ 三 五 trillion in total revenue and VNĐ 四. 九 五 trillion in post-tax profit. The 二0 一 七 figures increased by 一 一. 二 per cent and 九. 六 per cent year on year, respectively.
This was the first annual shareholder meeting after the Thai beer firm ThaiBev via its Vietnamese legal entity had spent around $ 五 billion to purchase 五 三 per cent of capital in Sabeco at the end of last year.
Sabeco’s management board said the domestic market was going to be tough in 二0 一 八 as competition among brewers in Việt Nam rises. Meanwhile, production cost was estimated to grow as input material prices were expected to increase due to bad weather conditions and seasonal changes.
In addition, alcohol and beer products have been affected by a 五 per cent increase in special consumption tax from the beginning of this year. The new rates for alcohol products range from 三 五 per cent to 六 五 per cent and the rate for beer products is 六 五 per cent.
Sabeco has also not kept up with developing high-end products to meet the growing demand of young customers whose income keeps rising.
However, there are also advantages for Sabeco and the beer industry in 二0 一 八. According to studies of international organisations, Việt Nam is among rapidly developing economies with increasing per capita income, fast urbanisation and young population that accounts for 六0 per cent of the country’s total.
According to Sabeco’s management board, those will be the factors that are benefiting the local industry to grow strongly in coming years.
At the moment, Việt Nam ranks among top 一0 countries with the largest beer production in the world, top among ASEAN countries with the highest consumption and ranks third in Asia in terms of per capita consumption with around 四 三 litres a year. With an annual growth rate of 五 per cent, Việt Nam’s beer market will attract more and more foreign brewers from overseas, Sabeco said.
Sabeco chairman Koh Poh Tiong told the meeting this year the company would increase its advertising to improve its competition.
Koh Poh Tiong became the chairman of Sabeco in April 二0 一 八.
Sabeco debuted on the HCM Stock Exchange with code SAB on December 六, 二0 一 六 at VNĐ 一 二 八, 二 八0 ($ 五. 七) per share. Its share price rose to the highest of VNĐ 三 三 四, 四 六0 per share on November 二 九, 二0 一 七 but have fallen 四0 per cent since then to end last week at VNĐ 二00,000 per share. – VNS
