PETALING JAYA: Heineken Malaysia Bhd’s net profit for the first quarter ended March 31, 2019 (Q1’19) increased 8.3% to RM52.81 million from RM48.76 million a year ago, attributed to higher sales and efficient management of commercial spend.
Revenue for the quarter rose 21.1% to RM525.14 million from RM433.81 million, mainly driven by higher sales volume from effective execution of commercial campaigns during Chinese New Year 2019 and the increase in sales revenue prior to the price adjustment on April 1, 2019.
Heineken said the price adjustment was necessary due to higher cost of packaging and raw materials following increased global commodity prices. This was the first price increase since the Sales and Services Tax (SST) was introduced on Sept 1, 2018.
In view of the government’s decision to postpone the implementation of the sugar tax on beverages until July 1, 2019, pricing taken on the non-alcoholic Malta currently excludes this new tax.
“We have kept price increase to a minimum and we have not increased the prices of some of our products. We are mindful of the challenging market conditions and that the Consumers Sentiment Index fell further below the confidence threshold of 85.6 in Q1,“ said managing director Roland Bala.
Commenting on the outlook for the rest of the year, he said the company will leverage on the solid growth in Q1 to continue sharpening its focus on executing the right strategies to drive value creation for our stakeholders towards delivering a satisfactory performance for 2019, whilst being cautious of softening consumer sentiment and competition that is expected to intensify.