Spending less on advertising, the owner of Saigon Beer Company still makes a trillion dong profit, why?28/04/2022
(Dan Tri) – Sabeco recorded strong growth in revenue and profit in the first quarter after being heavily affected by the pandemic.
Saigon Beer – Alcohol – Beverage Joint Stock Corporation – Sabeco (stock code: SAB) has just announced the first quarter financial report with business results increasing sharply compared to the same period in 2021.
Accordingly, the net revenue of the company that owns the Saigon Beer brand in the first three months of the year reached more than 7,300 billion VND, up 25% compared to the first quarter of 2021. According to Sabeco Deputy General Director Koo Liang Kwee, the reason for the sharp increase in revenue was a better product portfolio and higher selling prices compared to the same period last year. At the same time, despite the high price of input materials, Sabeco’s gross profit margin still increased slightly by 1%.
In the last period, the beer giant also tightly controlled many costs, reducing the budget for advertising and promotion activities. However, Sabeco’s revenue from financial activities decreased by nearly VND 200 billion.
Finally, Sabeco’s net profit in the first quarter was VND 1,171 billion, up 25% over the same period in 2021.
Sabeco’s annual general meeting of shareholders on April 27 has just approved this year’s business plan with expected revenue of VND 34,791 billion, up 32% and target profit after tax of VND 4,581 billion, up 17% compared to 2021. Thus, compared to the above plan, the company has achieved 27% of the profit target after the first quarter.
Sharing with investors, Sabeco General Director Bennett Neo said that the company recorded an upward trend in market share, although did not disclose the exact number. According to him, the company always aims to have a better market share in all segments from high-end, mid-high-end, mass to affordable products. In particular, management will target segments of companies that have low market share but have many growth opportunities.
Regarding the impact of rising raw material prices, Mr. Koo Liang Kwee said that the company has pre-order contracts and is quite safe this year and is considering purchasing plans for next year. According to the deputy general director of Sabeco, in addition to the story of price increase, not letting the supply chain of raw materials be disrupted is also a problem.
Factors such as the conflict in Ukraine, the blockade of the Chinese city of Shanghai, all affected the global supply chain, including raw materials for beer production. Sabeco leaders said that the company has good relationships with suppliers, so it can still buy goods at reasonable prices.
A representative of Sabeco’s management board also said that in addition to purchasing raw materials in advance to control input costs, the company also considers internal expenses, looking for ways to increase revenue by improving its product portfolio. Rather, increase the selling price if the market allows it to protect profits.