Jan. 7 - San Miguel Brewery Hong Kong is expected to report steady growth in volumes for its South China operations, reflecting the scale of changes made over the last few months to strengthen the business, and focus on higher growth categories and markets.
For South China, San Miguel volumes in November grew by 5% year to- date.
The rationalization of the company’s operations in Hong Kong and the former Guangzhou brewery will significantly streamline costs and improve the long-term overall profitability of the business. The decision to restructure operations came as a result of relatively higher production and operating costs in these locations as compared to SMBHK’s other South China brewery, San Miguel Guangdong Brewery.
The Hong Kong government’s recent initiative to reduce beer tax duties to 20% from 40% is seen to directly benefit the industry as wholesaler and retailer prices will, as a result, be brought down.
To capitalize further on this development, San Miguel will continue to implement outlet-based programs in tandem with a brand awareness campaign anchored on the highly popular regional TV commercial featuring martial arts superstar Jet Li.
Mirroring its strong performance in South China, San Miguel Brewery, Inc.’s Philippine business sustained ten consecutive months of volume and revenue growth. Volumes for the year rose 7.6% driven by good performances for flagship brand Pale Pilsen and core brands like Red Horse Beer and increased consumer spending and buying power. Lower cost of raw materials effectively complemented internal costmanagement measures, resulting in a significant growth in operating income.