The Company is mainly engaged in the production and sales of beer, the production, sales and domestic trade of beer.
The Group's profit attributable to shareholders for the 6 months ended 30-06-2019 amounted to RMB 1.63 billion, an increase of 25.2% compared with previous corresponding period. Basic earnings per share was RMB 1.2069. No dividend declared. Turnover amounted to RMB 16.55 billion, an increase of 9.2% over the same period last year, gross profit margin up 1.4% to 32.1%. (Announcement Date: 15 Aug 2019)
Business Review - For the six months ended June 30, 2019
During the first half of year 2019, China’s beer market has achieved stable development, the upgrading of consumption structure has continued, and industrial capacity and product mix have been further optimized, with beer production reaching 19.488 million kl (Data source: National Bureau of Statistics, production of beer companies of above designated scale), a slight increase of 0.8% from the corresponding period in the previous year.
During the Reporting Period, the Company has adopted a proactive approach towards the expansion of domestic and foreign markets, and has implemented a range of measures, including the optimization of brand and variety mix structure, so as to achieve the positive development trends of sustained growth in sales volume, sales revenue and net profit, as well as the continued rise of brand value. During the Reporting Period, the Company’s sale volume of beer has reached 4.73 million kl, an increase of 3.6% from the corresponding period in the previous year; the Company has attained RMB 16.551 billion in operating revenue, an increase of 9.22% from the corresponding period in the previous year, and RMB 1.631 billion of net profit attributable to shareholders of the Company, an increase of 25.21% from the corresponding period in the previous year.
During the Reporting Period, the Company has continued to strengthen its brand development strategy of “Tsingtao Beer as Core Brand + Laoshan Beer as Secondary Brand”. By focusing on its product strategy and regional strategy, the Company has proactively carried out brand promotion, harnessed the brand and quality advantages of Tsingtao Beer, and further enhanced the mid-to high-end brand positioning of Tsingtao Beer. By ensuring the stronger, better, bigger and faster transformation and upgrading of Tsingtao Classic, Tsingtao draft beer, new special products and Laoshan Beer towards high valued-added products, the Company has continued to drive the improvement and upgrading of product mix. During the first half of the year, sales volume of the Company’s core brands has reached 2.360 million kl, an increase of 6.3% from the corresponding period in the previous year, thus maintaining the Company’s competitive advantage in the domestic mid-and high-end markets.
In light of the grave challenge of rising raw material costs, the Company has continued to optimize cost control and spending, as well as strengthen its budget management efficiency, while striving to enhance product mix and price. Through a combination of measures to reduce costs and increase efficiency, the Company has maintained the continuous and stable growth of its sales volume and profit.
During the first half of year 2019, “Tsingtao Beer” has topped the list of China’s beer industry brand value for the 16th consecutive year with a brand value of RMB 163.772 billion; the brand value of the Company’s secondary beer brand “Laoshan Beer” has reached RMB 32.709 billion. (Data source: World Brand Laboratory)
Business Outlook - For the six months ended June 30, 2019
Through the Company’s continuous promotion of innovation-driven development, the Company has optimized the bidding strategy of centralized procurement by creating efficient supply chain synergies, thereby actively absorbing the pressure of rising costs; the Company has adopted new technologies of intelligent manufacturing to achieve intelligent and green production, increased the efficiency of resource allocation, expedited the conversion from old to new growth drivers, and maintained its differentiated competitive advantages. The Company has actively promoted the development and implementation of new channels and new business operations, accelerated the market layout of new retail and new business operations, as well as continued the improvement of its e-commerce sales channel system to satisfy consumers’ purchase demands and consumption experience through multiple channels in the Internet era, thus developing new growth potential for the sustainable and healthy development of Tsingtao Brewery.
Source: Tsingtao Brewery (00168) Interim Results Announcement