Strong results support Asia Pacific Breweries expansion

By Neil Merrett

- Last updated on GMT

Related tags: Southeast asia, Pacific ocean

Asia Pacific Breweries posted a 7.3 per cent rise in organic growth
through its first quarter results, as it increases its presence in
the region to meet growing demand for its products.

The Singapore-based brewer of popular brands like Tiger beer, revealed organic growth of €16.5m through its first quarter results over the same period the previous year. The results reveal a growing number of opportunities for brewers looking to operate within the Asia Pacific region as companies look to target both its established and emerging markets. Along with the strong performance of the company in its native Singapore, the group also witnessed notable success in a number of its key markets including China, New Zealand, and Vietnam. In China, the company boosted its sales volume by 11 per cent, helped by a fall in operating losses. The groups operations in New Zealand and Papua New Guinea recorded similarly strong performances with volume growth of 12 and 14 per cent respectively. APB also hailed its increasing presence in the Indochina market as a key factor in their success within the quarter, with recent purchases including the acquisition of the Fosters brand in Vietnam seeing a 26 per cent increase in volume. The quarter was not without some disappointments for the brewer however with a decline in some of its other markets like Malaysia - which saw an 11 per cent decline in volume resulting in PBIT falling by 22 per cent. This decline was attributed in part to higher marketing investments. APB also spent €1.2m on increasing its presence in markets like Sri Lanka, Mongolia and India. Despite these increased costs, the company remains confident of maintaining its performance in the year ahead through it plans to continue expanding its regional and global presence. During the 2007/2008 financial year, the group expects to expand its operations to 35 plants throughout 12 countries. Currently APB control 29 operational breweries in 10 country's in the Asia pacific region. The company also highlighted an exclusive US distribution deal with Anheuser-Busch that will allow it to significantly increase its presence in the country's growing imported beer market. With its Tiger brand available within 48 states in the US, APB estimates it will be in a prime position to capitalize on a market worth 12 per cent of total beer demand in the US – which is predicted to grow at around 7 – 8 per cent annually.

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