SARS inflicts P216.7-M loss to SMC HK in 2003

San Miguel Brewery Hongkong Ltd., a unit of food and beverage giant San Miguel Corp., incurred a net loss of HK$32.8 million or P216.7 million last year due to difficulties brought about by the severe acute respiratory syndrome (SARS) outbreak.

The loss was attributed to the consumers’ shift towards the low-priced segment of the beer market in Hongkong.

The company registered revenues of HK$1.16 billion, 13 percent lower than the previous year’s level as a result of the SARS outbreak in the first half and the drive to cut trade receivables that were reduced by HK$75.4 million.

SMBHK said a provision for deferred tax of HK$9.5 million was made pursuant to a new accounting standard introduced in 2003.

However, the firm’s South China operations reported an operating profit, a major improvement over 2002. Improved sales and distribution systems succeeded in growing volumes in key areas in that region.

While 2003 was a difficult year, the company remains committed to consolidate its position in the Pearl River Delta region and ensure that San Miguel stays as the leading brand there.

SMC, Southeast Asia’s largest food and beverage group, expects its revenues to increase by 25 percent this year with most of its main businesses driving the growth.

SMC president Ramon Ang said earlier the growth will be primarily driven by the company’s beer operations, packaging and food units. For this year, revenues of the SMC Group are expected to grow by more than 20 percent while profits are seen to rise by 10 percent compared with last year’s figure.

SMC’s regional expansion, according to Ang, remains on track with most of its new manufacturing plants expected to be operational by 2005. Among the areas earlier identified by SMC ideal for its regional expansion are Vietnam, Indonesia, Malaysia, Taiwan, China and Thailand.

SMC’s annual group revenue should be boosted by $300 million from sales generated in these markets. SMC has earmarked up to $700 million for planned acquisitions and investments in Asia, aimed at seeking offshore growth to complement its dominant foothold in the local beverage market.