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05 April, 2006



Brewing news Malaysia: Carlsberg Malaysia to focus on maintaining its leadership

Carlsberg Malaysia will be focusing its efforts and resources on maintaining its market leadership in the beer sector and increasing its market share in the stout segment, its general director Datuk Lim Say Chong stated to the Edge Daily. He said it would strive to do so amid a highly competitive environment in the foreseeable future as the duty-paid beer and stout market was expected to contract.

“The three consecutive duty increases implemented by the government resulting in the high consumer price for duty-paid beer and stout products in Malaysia does not augur well for the brewery industry. The presence of low-priced imported beers and the increasing levels of smuggled beer products would also further exert pressure on the recovery of the growth of the Malaysian beer and stout market.

“The group expects 2006 to be very challenging,” he said in his 2005 Annual Report statement.

He said the government continued to exert pressure on the brewery industry by announcing the third consecutive duty increase of about 8% last September.

“The duty increases have resulted in increase in the recommended consumer prices for beer and stout products totalling about 30% in less than three years. Malaysia's excise duty for beers is now the highest in the world after Norway,” Chong said.

Nevertheless, he said the group had maintained its leadership in the beer market through continued investments in its brands, innovative marketing strategies and improvements in operational strategies.

Its group revenue rose 10% to RM1.8 billion in FY05 from RM984.8 million in the previous year mainly from price increases following the hikes in excise duty and growth in export sales. It posted a pre-tax profit of RM112.4 million, which was 0.8% lower than the previous year’s. Earnings per share remained at 29 sen.

In total, Carlsberg will pay out a total of 32.5 sen per share less tax plus a special tax-exempt dividend of five sen per share. Chong said the group developed a commercial strategy last year to raise the existing goodwill and market dominance of Carlsberg Green Label and to grow overall market share profitably.

He added that the group registered an increase in export sales mainly to Singapore. Chong also said its recently launched SKOL beer had grown according to plans and had successfully established itself as the major beer brand in the value segment in the country. He said during the year, the group with the assistance of its parent company implemented a production excellence project aimed at achieving further efficiencies in the supply chain.





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