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. ...
China. CR Beer profit bubbles despite flat market
China Resources Beer bought out SABMiller’s 49 per cent stake in China Resources Snow Breweries — the brewer of the world’s top-selling beer by volume — for $1.6bn earlier this month, ending a 22-year-old joint venture that produced voluminous vats but punier profits, writes Patti Waldmeir in Shanghai.
Last year included big strategic changes for the company. “As of 1 September 2015, the Group had completed the disposal of all of its non-beer businesses – including retail, food and beverage businesses – to its parent company China Resources (Holdings) Company Limited (“CRH”) for a total consideration of HK$30m” the company said in a statement to the Hong Kong stock exchange.
“The strategic move has unleashed the value of its market-leading beer business from the previous conglomerate structure and associated capital constraints, allowing greater flexibility to execute its business plan and to lead further industry consolidation,” the company said.
Consolidated turnover and the consolidated profit attributable to shareholders of the Company’s continuing operations amounted to approximately HK$34bn and HK$831m, representing increases of 1 per cent and nearly 14 per cent, CR Beer said.
But Jeremy Yeo of Mizuho Securities in Hong Kong pointed out that core net profit (ex-losses taken on discontinued operations) was only up 9 per cent year on year to HKD815m. “The company’s implied 2H15 net profit on continuing operations declined 6.5 per cent year on year to HK$303m”, he wrote. The results reflect “harsh competition amidst an overall sluggish demand environment. We see consolidation as the primary driver of shareholder value over the medium term,” he said.
The China beer market shrank over that period, CR Beer said, “due to slower national economic growth and abnormal weather conditions in China” but the company’s beer business “deepened its penetration into various regions, optimized its product mix, enhanced its cost efficiency by leveraging its economies of scale and a better management over selling expenses”, the statement said.
Beer production in China in the first nine months of 2015, the latest period for which figures are available, fell 6 per cent by volume year on year, according to local analysts.
CR Beer’s purchase of the Snow stake was viewed as a key milestone for AB InBev as it has been shedding assets to win regulatory approval across the globe to close the largest beer deal in history.
18 Мар. 2016