San Miguel Brewery posts 17.4% earnings growth

MANILA, Philippines -  San Miguel Brewery Inc. (SMB), the largest beer producer in the country, reported a 17.4- percent growth in net income last year on higher sales volume for both local and international operations, as well as improved selling prices.

In a statement issued yesterday, SMB said net profit reached P12.2 billion compared with P10.4 billion in 2010.

Net sales revenue amounted to P71.9 billion, up 6.3 percent from the previous level’s P67.6 billion.

As a result, operating income rose 10 percent to P20.5 billion.

SMB earlier approved a plan to issue peso-denominated bonds worth up to P20 billion to refinance the first tranche of fixed-rate bonds issued in 2009. The first tranche, amounting to P13.6 billion, will mature on April 3, 2012.

Other proceeds would be used to prepay the company’s $300-million term facility.

The new bonds have a minimum term of five years and a maximum term of 10 years.

Parent firm San Miguel Corp. owns 51 percent of SMB while Japanese brewer Kirin Holdings holds 48.4 percent.

SMB earlier said it was planning to build breweries in Laos and Cambodia, each with a capacity of about 500,000 hectoliters, as part of a plan to boost its profability.

On the homefront, the company plans to put up four bottling plants in Laguna, Isabela, Bicol and Cagayan de Oro, worth around $100 million. These plants are seen to boost the company’s bottling capacity by 30 percent.

SMB accounts for 96 percent of the Philippine beer market, which is expected to continue to grow in the low single-digit levels given robust consumer spending.