SAN Miguel Brewery (SMB) Inc. said it sees its sales volume growing 16 percent this year, boosting its net income to P15 billion by year-end.
It said, however, it will not acquire international brands to bring, into the local market this year.
In an interview after the firm’s annual stockholders’ meeting on Tuesday, SMB Chairman Ramon S. Ang said volume growth will be coming from a drop last year because of the imposition of higher “sin” taxes and higher consumer demand.
“I think SMB is doing very well because for the first quarter alone, net income reached P4 billion. And that’s not the peak season yet. Usually, the peak is during Christmas and summer,” Ang said.
If sales remain normal, Ang said net income should reach P12 billion to P15 billion this year, compared with the reported P13.5 billion earned in 2015.
Net income already grew 23 percent in the first quarter. The company is also seen to benefit from higher consumer spending in the first two quarters of the year because of the national elections.
SMB sells nine of the 10 beer products in the country, but struggled to make a significant footprint outside of the Philippine market. Ang said the company boasts of a commanding 97-percent share of the market.
Ang dismissed the perceived premiumization in the preference of consumers, noting this market segment consists of just a very small number of consumers.
“We are in every segment of the beer market. We also have San Miguel Premium Beer for the premium market. In fact, our premium beer is doing very, very well. Even in the international market, our San Miguel Premium is doing very, very well,” Ang said.
“In the beer business side, SMB does not need to do anything. We have been competing with every major beer maker in the world; none of them succeeded in competing with us in the Philippines,” he said. “It’s nothing new that an international brand tries to penetrate the local market. They’ve been coming here for the last 50 years. But they are used to selling beer at P200 to P300 a bottle, while beer here sells for only P20 plus per bottle,” Ang added.
He also said SMB is not threatened by prospects of a liquor ban, which is in effect in Davao and is widely expected to be implemented nationwide by the incoming Duterte administration.
Under the ban, alcoholic products cannot be sold beyond 1 a.m. or 2 a.m.
“The liquor ban is nothing new for us. Our volume in Davao is not affected at all. Besides, a lot of beer drinkers now drink in the daytime because they work in call centers,” Ang said.