Profits of beer businesses saw a decline

Decreasing revenue and profit

Saigon Beer - Alcohol - Beverage Corporation (Sabeco) has announced business results for the fourth quarter of 2023 with net revenue reaching more than 8,500 billion VND, down 15% compared to the same period in 2022.

Along with revenue decline, Sabeco reduced financial costs by 51% and selling costs by 17%. However, business management costs and other expenses still increased over the same period. However, Sabeco's profit after tax still only reached 970 billion VND, down 10%.

For the whole year 2023, Saigon Beer's net revenue reached more than 30,400 billion VND, down 13% compared to 2022. In particular, beer sales revenue decreased by 12%, reaching nearly 27,000 billion VND. Net profit accordingly decreased by 23%, reaching just over 4,200 billion VND.

In 2023, Sabeco targeted revenue of 40,272 billion VND and profit after tax of 5,775 billion VND. Thus, Sabeco only achieved 75% and nearly 73% of the proposed plan, respectively.

Explaining the decline in results, Sabeco's Board of Directors said that last year's net revenue decreased due to fierce competition in the beer market, reduced consumer demand, along with the strict implementation of Decree 100 on alcohol concentration control when participating in traffic.

Profits were also affected by higher input and management costs, and lower profits in joint ventures and associates, although partially offset by financial revenue.

In 2023, Sabeco spent only more than 2,800 billion VND on advertising and promotion, a decrease of more than 250 billion VND compared to 2022.

Along with Sabeco, Habeco also just recorded a year of backward business. The enterprise recorded 7,700 billion VND in net revenue, down 8% compared to 2022. Net profit decreased by more than 29%, reaching only 355 billion VND.

Habeco said that the reason for this year's decline in revenue is mainly due to increasingly fierce competition in the beer market and people's reduced consumption trends in a volatile socio-economic context.

In addition, increased alcohol control in the last months of 2023 also affected the company's revenue.

Last year, Habeco drastically cut advertising, promotion, and support costs to only 579 billion VND compared to 700 billion VND in 2022. This is Habeco's most expensive cost, accounting for 48% proportion in sales cost structure in 2023 and previously 54% in 2022.

Source: theleader

Compiled by VBI