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FOOD & BEVERAGE | Staff Reporter, Singapore
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ThaiBev rides on holiday cheer as Q1 profits set to rise 11%

Its SABECO operations continue to show positive results after completing its restructure process.

ThaiBev's profits are set to rise 11% to $255.3m (฿5.9b) in 1Q2019 from $229.3m (฿5.3b) as the usual year-end festivities boost beer sales, according to CGS-CIMB.

This could account for over a quarter ( 27.5%) of the company’s FY19 profits. Revenue could soar 50% YoY to $2.95b (฿68.3b) as SABECO continues to record positive results following its restructuring, however finance costs are likely to rise following previous acquisitions.

“We believe the resumption of Thai beer sales and efforts to optimise SABECO’s earnings will reinstate confidence in ThaiBev. Catalysts are higher-than-expected margins across all segments and better results from SABECO. Risks are vice versa,” said Cezzane See, analyst at CGS-CIMB.

Also read: Bottoms up: The worst is over for ThaiBev

SABECO reported that their net profit of $245.9m (VND4.2tr) in FY18 has surpassed its target of $234.2m(VND4.0t) due to its new management’s advertising and marketing strategies.

The beer producer are also showing efforts on streamlining costs and focus on improving business productivity and efficiencies such as slimming down office space, minimising raw material costs and improving distribution network to enhance the freshness of its beer.

On FY18, ThaiBev saw their profits plunge 46% to $77m, driven by an increase in finance costs as well as a decline in consumer purchasing power in Thailand. It reflected 13 months of dampened growth.

After a series of decline, its beer production levels rose to 11.2% in November MoM from 10.5% as alcohol demand rose. 

Photo credit: ThaiBev's Facebook page

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