Heineken Malaysia net profit rises to RM282.5mil

Good results: Bala (left) and finance director Szilard Voros relaxing with a glass of beer each after announcing its 2018 full-year financial results.

KUALA LUMPUR: Heineken Malaysia Bhd is maintaining a cautious outlook for the financial year ending Dec 31, 2019 (FY19), in light of the challenging market environment due to intense competition and rising raw material costs.

The group registered a year-on-year net profit growth of 4.6% to RM282.52mil for FY18. Revenue rose 8.3% to RM2.3bil, mainly attributed to higher sales volume, price adjustments on April 15, 2018, as well as the implementation of the sales and service tax on Sept 1, 2018.

Its fourth-quarter net profit rose 6.8% to RM100mil when compared to the same quarter in FY17.This was mainly due to higher revenue as well as efficient and effective management of commercial spend and overheads.

Notably, this marks one of the group’s highest quarterly growth rates in the past three years. In terms of brand portfolio, Tiger, Heineken and Guinness continue to lead the mainstream market segment.

Speaking at the group’s financial results briefing yesterday, Heineken Malaysia managing director Roland Bala said the group would need to adopt a cautious approach in cost management, amidst slowing global growth rates, currency volatility and uncertainty in the commodity markets.

“The external environment remains challenging. In addressing the rising cost of raw materials, we will review our procurement activities and exhaust all possibilities in our control to manage this. Going forward, there are more exciting things coming in 2019, as we continue to shape the market through a consumer-inspired innovation agenda,” he said.

Bala added that while illicit alcohol was still a threat, there have been positive steps in addressing the issue, which entails an increase in the minimum penalties against those found dealing in illicit products.

“We would like to thank the government and the Royal Malaysian Customs for their efforts in addressing the illicit alcohol issue, which causes significant revenue loss to both government and industry.

“We will continue to give our full support to the government in addressing this concern,” he said.

The board of Heineken Malaysia has also proposed a single-tier final dividend of 54 sen per share for FY18, bringing the total dividend for the year to 94 sen per share. The single-tier final dividend will be paid on July 19, 2019 to shareholders registered at the close of business on July 5, 2019.

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