Analysis of beer market in China (on Russian)
Beer market of Ukraine: big three losing weightIn 2016, fast increase of excises and resulting price spike stood in the way of the beer market stabilization. Most of competition (as well as mass sorts) moved to the economy segment of the market. The biggest losses were incurred by the leading three, especially Obolon, which again experienced pressure after reallocation of Efes market share. However, one should already speak of TOP-4. Group Oasis CIS (PPB) became a strong player and competitor to transnational companies. Besides the net sales of many regional medium breweries look rather good and 16-fold cost reduction wholesale trade license for craft brewers opens up a possibility of rapid growth in 2017.
Analysis of beer market in China
China’s transition to a “new normal” reality backfired on the brewing industry unexpectedly. Stagnation and subsequent market decline resulted from dynamic social and economic changes. There has emerged a “two speed” market where the medium class significance is growing, yet the share of main beer consumers, “blue collar” is decreasing. Also the inflow of consumers is shrinking, as demographics stopped being a growth driver. Finally, beer is giving way to other alcohol drinks....
China. Tsingtao sales dropped by 4.9% because of domestic beer market decline
Apparently, the net profit dropped by 13.9% and sales fell by 4.9% in 2015, while the domestic beer market decline was 5.1%.
|Less: Cost of sales||(17,192,101,695)||(17,899,291,275)|
|Taxes and surcharges||(2,030,394,346)||(2,182,624,248)|
|Selling and distribution expenses||(5,904,539,236)||(5,682,981,368)|
|General and administrative expenses||(1,412,435,528)||(1,362,297,511)|
|Finance expenses — net||299,597,521||334,652,990|
|Asset impairment (losses)/reversals||(2,062,375)||3,513,780|
|Add: Investment income||462,412,814||23,959,509|
|Including: Share of (losses)/profits of associates and a joint venture||(4,562,375)||23,840,743|
|Add: Non-operating income||558,817,491||469,416,868|
|Including: Gains on disposal of non-current assets||29,048,431||3,216,362|
|Less: Non-operating expenses||(139,158,284)||(70,671,089)|
|Including: Losses on disposal of non-current assets||(130,560,143)||(62,932,536)|
|Less: Income tax expense||(662,778,888)||(663,466,755)|
According to the report, the full-year sales volume of Tsingtao Beer, the principal brand, reached 41.6 million hl including 17.4 million hl of domestic sales volume of the high value-added products such as Hong Yun Dang Tou (“Good Fortune”), Augerta, Classic 1903, draft beer, canned beer and small-bottled beer which realized continuous growth.
Tsingtao Brewery is the largest Chinese beer exporter. In 2015 its overseas sales increased by 16.4% to 298.1 million yuan (excluding Hong Kong and Macau). Foreign sales accounted for 1.08% of overall sales in 2015 instead of 0.88% in 2014.
Within the year, Tsingtao Beer became the first beer brand whose brand value had reached over RMB100 billion with its brand value of RMB105.568 billion, meanwhile the brand value of Laoshan had also reached RMB11.568 billion, which continued to maintain its leading position in the domestic beer market, according to the World Brand Lab.
According to the company’s plans, operating target for 2016 is to strive to realize the growth of sales volume of beer being 2 percentage points higher than that of the industry.
29 Mar. 2016