Dmitry Nekrasov’s Philosophy — on the Past, Present and Future of Ukrainian Brewing IndustryA meeting with Dmitry Nekrasov always turns into a training course: “Introduction to brewing business“. We are talking to a clever “playing trainer“ a person that can be called a godfather of the Ukrainian craft. He has a dozen of successful projects to his name. Dmitry told us about craft beer in Ukraine, on market cycles, on specifity of operating in retail and HoReCa, on union of Ukrainian brewers and certainly, how a brewery of his own, First Dnipro Brewery is doing.
The market of import beer in Russia: review and databasesThe market of import beer is rapidly growing and changing. But while in the past years it was growing due to brands variety, in 2019 major and affordable brands from TOP-10 were developing actively. It seems that the fact of a brand origin from far abroad counties, even if it is not well known but has moderate price and good distribution provides for million liters of sales in the territory of Russia. Among distributors AB InBev Efes was far behind, yet the role of Baltika and suppliers of the second row got more important. The boom of German brands was followed by stagnation of import from other traditional regions (and Belarus) instead the supplies from Mexico, Lithuania and Asian countries grew considerably.
Russia: Positions of Brewing CompaniesThe review contains an analysis of interim performance of brewers in the first half of 2019. There are rather dynamic changes behind a modest industry growth. Baltika is again experiencing a stage of volumes and market share slid due to competition with AB InBev Efes. Because of the price competition and presence expansion in the modern trade company #2. has come close to the leading position. At the same time sales of Heineken Russia have continued growing which makes the premium part of the portfolio heavier. The market premiumization trend had been also confirmed by import brands. MBC and Zavod Trekhsosenskiy have been the most successful among federal market players. The market share of independent regional brewers and Ochakovo have continued falling as they are being squeezed out by the market leaders at their competitive fields.
Ukrainian beer market 2019: companies and brandsIn 2019 beer production and market have been still fluctuating about zero point. However, the past season was successful for brewers judging by the sales profitability. The price mix has improved due to rapid general market premiumization, as well as its particular aspect, the growth of import beer sales. By the season end AB InBev Efes improved its positions considerably. It turned out that consumers had not forgot Efes brands that had to leave the market, but started to recover rapidly. Against the stagnating market that meant sales decline of other companies, in the first place Carlsberg Group that most of all beneficiated from Efes exiting the market. PPB turned out to be stable to branding activity of its competitor and Obolon kept the same volumes and at the moment it is the absolute leader of the economy segment. The share growth of independent producers took place thanks to leading craft breweries, that so far do not have a big market weight, but they are rapidly gaining it.
Brewing industry in Kazakhstan 2019During the first half of 2019, the majority of Kazakh brewers made their contribution into positive dynamics. Yet it was companies of the lower division, not the two transnational leaders that raised their production and sales. The shares of draft beer and aluminum can which is rapidly squeezing glass bottle out of the market, have been growing. The price segmentation has remained stable despite the substantial rise of retail prices and fluctuations of brand market shares, while the borders between segments have become blurred. The main events in the industry have been: the announced revision of the beer excise policy, launch of BeerKhan brand in the strong beer segment, and most important – purchasing assets of Shymkentbeer by Arasan.
The trend of complication of Russian beer market is going on and in several directions at the same time. The range has got wider, the import and small segments are growing, namely craft beer, alcohol-free beer and special flavor beer. At the same time, all ex-mega brands and light lagers by Russian brewers are experiencing a decline of their shares. AB InBev Efes, Heineken, MBC and Pivzavod Trekhsosenskiy have exceeded the market, Carlsberg was developing slower than the market and Ochakovo as well as some other mid-sized breweries have been cutting down their volumes. To a big extent brewers’ performance was connected to their ability to reach agreement with networks, sacrifice their margin and enter new markets. Craft brewers are facing a serious danger of producers’ registration introduction – de facto licensing. ...
San Miguel Says to Stay Listed After Ang Says Brewer May Be Taken Private
“San Miguel shall remain listed, owing to its iconic status in the country,” the Philippines’ largest listed company said today. The statement, citing Ang, was issued in response to queries, it said. San Miguel said it also “contemplates” to list all its operating subsidiaries, including new businesses.
Ang said in an interview yesterday that if he has his “way,” San Miguel will buy back its shares and become privately held by next year. Buying back the shares may cost about $800 million, he said. San Miguel had a public float of 14 percent as of May 5, it said at the time. That’s worth about 40 billion pesos ($943 million) based on today’s share price.
“A listed company has more advantages than a privately held corporation in terms of financing and attracting investors,” said Astro del Castillo, managing director at Manila-based First Grade Finance Inc.
The food and beverage company that’s expanding into oil refining, power retailing and infrastructure is also in talks to buy an overseas company with an enterprise value of $10 billion, Ang said yesterday. The target has a “potential free cash flow of between $2 billion and $3 billion a year,” he said. The discussions may take “a few more months,” Ang said.
Return on Equity
Compliance with the Philippine Stock Exchange’s requirements on disclosures has sometimes made it difficult for San Miguel to make purchases, Ang said yesterday. The Philippines’ most acquisitive company, which started as a brewer more than a century ago, seeks to triple the 7 percent return on equity it gets from its traditional food and drinks businesses.
San Miguel rose 1 percent to 122 pesos at the close of trading in Manila, paring gains after rising as much as 2.7 percent earlier. The stock has lost 26 percent this year, compared with a 3.7 percent gain for the Philippine Stock Exchange Index.
“If your balance sheet is strong like San Miguel, you don’t need to be publicly listed,” Ang said yesterday at the company’s headquarters in Manila. “If I have my way, I will privatize it next year,” he said.
Listed companies are more prone to “leakage” of information, and disclosures sometimes work to the advantage of competitors, Ang said in the interview.
San Miguel had 127 billion pesos in cash and near-cash items as of June and has a total of 186 billion pesos of bonds and loans due by 2019, according to data compiled by Bloomberg.
The company’s units such as Petron Corp. (PCOR), the country’s biggest refiner, and San Miguel Brewery Inc. (SMB) will probably remain listed, Ang said yesterday.
Ang declined to provide more details on the acquisition target such as which industry it operates in or where it’s based.
9 Сен. 2011