China Resources Beer posts 1.3b yuan income

China Resources Beer (0291) said net profit increased by  34 percent to 1.31 billion yuan (HK$1.45 billion) last year from 2018 due to its brand repositioning strategy including acquisition of Heineken China.

The basic earnings per share were 6.06 yuan. A final dividend of 0.045  fen was declared.

Hou Xiaohai, chief executive, expects revenue and EBIT for the first two months this year to drop by 26 percent and 42 percent year-on-year, respectively, as the operation of the food and beverage sector is restricted amid the coronavirus global pandemic.

Revenue from beer sales this month remains small despite the opening of some restaurants. He expects the impact on sales from the virus to be limited in April and sales will recover in the second half this year.

He said the Snow beer production is 95 percent resumed while the last factory, located in Wuhan, will restart production tonight. Capacity is expected to fully recover in the second half of April, he said.

Consolidated turnover was 33.19 billion yuan, up by 4.2 percent from 2018.

During the year, the group implemented its brand repositioning strategy and further boosted the product mix upgrade of the “Snow” beer products, in addition to the acquisition of Heineken China.

As a result, the group recorded an increase of 8.8 percent in mid- to high-end beer sales volume, which led to higher  average selling price by 2.8 percent, compared with 2018.

The coronavirus pandemic in China and across the world would have negative impact on  production and sales in the first quarter, the company says.