May 7, 2012

Vietnam - Habeco left with kicking hangover


A big northern beer-maker has been left with a hangover after missing its business targets in 2011.

Habeco, which has an 85 per cent market share in Hanoi and 13 per cent nationally, met only one of its five business targets set by its previous shareholder meeting.

Specifically, industrial production, total revenue, total after-tax profit and sales in 2011 reached $86.7 million, $254 million, $30.8 million and $19.9 million, against a planned $89.7 million, $266 million, $33.4 million and $21.3 million, respectively.

Only the average salary was VND10.8 million ($519) per month, up by 5.6 per cent against a planned VND10.2 million ($490) per month. Habeco general director Nguyen Hong Linh said 2011 was a difficult and challenging year.

“In 2011, the global debt crisis badly impacted on the domestic economy which caused financial woes for many enterprises. From early last year, complicated exchange rate, gold and interest rate fluctuations, plus petrol and electricity price rises made inflation higher and consumption lower, especially for beverage products,” said Linh.

In addition, he said input costs also sharply went up from 10-30 per cent, while the beverage market competition was more heated. Vietnam Beer-Alcohol-Beverage Association Ngo Quang Vinh spokesman said Habeco was not the only firm feeling the heat in the sector.

“Higher inflation and interest rates have lessened people’s demand for goods such as beer and alcohol. Meanwhile, advertisements and promotions for beer and alcohol are restricted,” said Vinh.
Denmark-based Carlsberg Beer Company is now Habeco’s foreign strategic shareholder with a 17.23 per cent stake, while the state holds a 81.79 per cent stake. Formerly, Carlsberg proposed the Vietnamese government raise the ownership ratio up to 30 per cent.

Habeco completed its equitisation to become a joint stock firm in March, 2008 with charter capital of VND2.31 trillion ($122 million). In 2012, the company plans to reach a revenue and an after-tax profit of $267.8 million and $32 million, up 1 and 3.9 per cent year-on-year, respectively.

“Formerly, a good product was enough to attract consumers. However, with the current drastic competition, the company’s trend to focus on market development is good,” Vinh said.

Nguyen Trang | vir.com.vn



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