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3-2019

Russia: Positions of Brewing Companies

The 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 brands

In 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 2019

During 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.

Malaysia. GAB: Business As Usual Despite Ownership Change

Guinness Anchor Bhd (GAB) does not expect any major shift in business directions following the takeover of its holdings company GAPL Pte Ltd by Heineken NV last October.

GAB MD Hans Essaadi said despite having a new parent entity, GAB is committed towards its business model which has propelled it to become a leading brewer in the market with a strong product line.

“We also do not expect any rebranding or renaming by GAB post-Heineken acquisition. GAB has always been a local entity. The advantages of being a locally listed company are enormous. Although we have foreign owners and shareholders, we are perceived as a local brewer.

“With the Guinness, Anchor and Tiger brands, we are perceived as a fantastic local brewer and we want to stay that way,” he told The Malaysian Reserve last Friday.

GAB Drink Sensibly Campaign

Heineken now wholly owns GAPL, which in turn holds a 51% interest in GAB.

GAB produces and sells a portfolio of beers and non-alcoholic malt beverages including Tiger, Anchor, Guinness and Malta brands.

GAPL, on the other hand, is the licensee for Guinness and ABC Stout distribution for the Singapore market.

GAPL was one of the two joint ventures that Amsterdam-based Heineken had taken control of in a deal worth US$781 million (RM3.38 billion) in October.

Besides GAPL, Heineken also bought a 57.9% stake in Jamaicanlisted Desnoes & Geddes which sells the Red Stripe beer brand.

That purchase effectively raised its stake to 73.3%.

Due to the changes in stakeholding, he said GAB is migrating its information technology system to suit Heineken’s.

“It would keep our people busy in the short term. But we are trying to make the integration as seamless as possible,” he said, adding that the integration requires minor adjustment at the company level.

“Otherwise, it’s business as usual,” he said.

Meanwhile, Essaadi said GAB has inked a long-term brewing and distribution agreement with Diageo plc, for the former to continue brewing and marketing Guinnessbrand beverages.

“The ownership change was a significant step for GAB. But the Guinness products are still very important for us, and Heineken is fully aware of that,” he added.

On projections for 2016, Essaadi said it would be a tough business environment for fast-moving consumer goods (FMCG) companies like GAB.

He said the Goods and Services Tax and political landscape are among the reasons behind the weak market sentiments.

“If you listen to the market, it is telling you that it’s not easy out there. People are quite scared and that depresses consumer demand.

“When we talk to competing FMCG companies, they all feel the pressure,” he said.

However, he said GAB’s business is quite resilient with a strong market position to absorb any drop. GAB recorded a 15.6% year-on-year increase in net profit to RM63.1 million for the first-quarter ended Sept 30, 2015.

The brewer also achieved 3% revenue growth to RM405 million, driven by higher sales and improved cost efficiency.

The Malaysian Reserve

17 Дек. 2015

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