Update GAB 4Q net profit dips 4%, proposes final div of 48.5 sen

Update GAB 4Q net profit dips 4%, proposes final div of 48.5 sen
Business & Markets 2013
Written by Shalini Kumar of theedgemalaysia.com
Thursday, 22 August 2013 19:08

KUALA LUMPUR (August 22): Guiness Anchor Bhd (GAB) posted a net profit of RM33.5 million for its fourth quarter ended June 30, 2013 (4QFY13), a dip of 4% from RM34.8 million a year earlier.

The was due to higher investment made for the brewer's brand-building activities, GAB told the exchange. Revenue for the quarter rose to RM412.1 million from RM346 million.

GAB plans to pay a final single-tier dividend of 48.5 sen per share in 4QFY13. This brings total dividends in FY13 to 68.5 sen.

GAB managing director Hans Essaadi said: “The results are in line with expectations and as the new MD; I am certainly delighted to be able to report such performance driven by our major brands Tiger, Guinness and Heineken.

"Tiger especially has grown phenomenally this year. We have also seen our premium segment contributing significantly to profitability, and this segment will remain our key focus area moving forward".

For the full year, the group posted a higher net profit of RM217.6 million compared to RM207.4 million a year earlier.

This came on the back RM1.7 billion in revenue versus RM1.6 billion.

“Whilst there has been growth, the market was rather challenging. The growth in the mature duty paid market is modest, while there was a significant reduction in volume for duty-free zones," said Essaadi.

Moving forward, Essaadi said the group has a strategy in place that will address the changing market climate.

The beer market is expected to experience relatively low growth barring no increase in excise duties. Other key challenges for the industry include rising input costs, contraband products in the market and the risk of higher excise duties.

“Our consumer profile is increasingly urban and Gen-Y. They are more aspirational, selecting brands that complement their lifestyle and not necessarily loyal to any brand. They are also constantly connected and on the move, which requires us to engage them on a different level, especially via social media.

"Beer products in Malaysia are not priced competitively for consumers. Consequently, contraband or duty not paid beer products have become an attractive option in the market as they are significantly cheaper," he said.

Essaadi also said GAB is mitigating these challenges by actively engaging the government and other key stakeholders.