San Miguel Brewery ’16 income surged by 31% to P17.7B

San Miguel Brewery, the country’s leading beer maker, saw its net profit surge by 31 percent last year to P17.7 billion, driven by record-high domestic volumes amid robust consumer spending in a presidential election year.

Consolidated revenues reached P97.2 billion, 18 percent higher than the level recorded the previous year.

As a result, operating income reached P27.2 billion, improving from P22.63 billion in the comparative year.

“SMB’s domestic operations reported its highest-ever sales volume of 202.6 million cases, 15 percent better than [the previous] year. The company synonymous with beer—nine out of ten beers sold in the Philippines are San Miguel beer brands—aggressively ramped up distribution, executed strong marketing campaigns and sales initiatives focused on increasing demand and consumption of its products,” SMB said in a statement on Monday.

“Election-related spending, growth in consumer confidence and the positive outlook for consumer spending also helped sales,” the company added.

In the comparative year 2015, total beer and malt-based beverage volumes increased by only 3 percent against a challenging backdrop arising from higher excise tax rates and aggressive competition in the market.

SMB said its international operations had also posted significant improvements in revenue and operating income driven by price adjustments, higher export volumes and cost management programs.

In 2015, SMB embarked on its new business of non-alcoholic beverages following the acquisition of the non-alcoholic beverage assets of Ginebra San Miguel Inc. SMB’s foray into this new market—seen as a dynamic beverage category—aims to bring sustained growth for the company and strengthen its competitiveness and resilience. —DORIS DUMLAO-ABADILLA