Top Brewer Sabeco Posts Record High 2016 Profit, Habeco Falls Far behind

Sabeco posted an all-time high profit in 2016 while Habeco’s earnings fell to a six-year low.


                                333, a long-standing brand of Sabeco. Photo: Internet

Ho Chi Minh City-based Sabeco, which commands around 40% of Vietnam’s beer market, said its consolidated net profit increased 37.8% year-on-year to 4.47 trillion dong ($198 million) in 2016, the heftiest since its establishment.

The firm, which made its share debut on the Ho Chi Minh Stock Exchange last December, reported net revenue of 30.64 trillion dong ($1.36 billion) last year, up 12.89% from a year earlier, according to its financial statement.

Sabeco, which stands for Saigon Beer Alcohol Beverage Corp., is currently 89.59% owned by the government while Heineken holds nearly a 5% stake in the firm.

Meanwhile, Hanoi Beer Alcohol Beverage, or Habeco, saw its net profit down 16.6% year-on-year to 725.2 billion dong ($32.1 million) in 2016, the lowest in the past six years, due to a loss of 158.6 billion in miscellaneous activities.

Its revenue increased 6.9% year-on-year to 10.3 trillion dong ($455.84 million), its financial report showed. 

According to a study by Nielsen, Habeco has failed to enhance its traditional foothold in northern Vietnam, with its market share falling to 50% in the first half of 2016, from around 55% in 2014, due to weak branding and marketing.

Sabeco, meanwhile, has managed to raise its share in the northern market to 15.5% in the first half of 2016, from 10% in 2014, as consumers have tilted to middle-end and premium products.

                 Habeco is failing to retain its dominance in northern Vietnam. Photo: Internet

The government’s plan to reduce its holding in Sabeco has drawn attention of international beer giants such as Heineken, ThaiBev, Kirin Holdings, Ashahi, and SAB Miller. Meanwhile, only Carlsberg, which holds a 17.08% stake in Habeco, has shown interest in buying more shares of the Hanoi-based brewer.

Vietnam has become a lucrative market for international brewery firms such as Heineken, Carlsberg and Sapporo. It has emerged to be the third-largest beer consuming country in Asia, after Japan and China, from the eighth position in 2008.

Beer production in the Southeast Asian country grew nearly 12% last year to 3.8 billion liters last year, with Sabeco accounting for 42%. The country’s annual beer output is expected to hit 4.1 billion liters by 2020 and 4.6 billion by 2025, according to government projections.

Beer sales in Vietnam increased 9% year-on-year to 322 million liters in January, in which the Lunar New Year or Tet festival fell, according to the General Statistics Office.

Tuan Minh / BizLIVE