Astute management is platform for SABECO success

The company, commonly known as SABECO, has announced its consolidated financial results for the third quarter of 2024, revealing a revenue of over VND7.7 trillion ($320.8 million). This marks an increase of around VND200 billion ($8.3 million) compared to the same period in 2023.

The company is continuing to launch new products to sit alongside its familiar classics

After accounting for expenses, SABECO reported a net profit of VND1.16 trillion ($48.4 million), representing an 8.1 per cent increase on-year. For the first nine months of 2024, its total revenue stood at VND22.94 trillion ($956 million), with a post-tax profit of VND3.5 trillion ($146 million), reflecting growth rates of 5 and nearly 7 per cent, respectively, from the prior year.

The corporation attributed its higher net sales to a combination of price increases, an improving economy, and heightened market competition. Additionally, a reduction in sales expenses contributed to maintaining a robust net profit, offsetting declines in interest income.

In Q3, despite increased raw material costs and strong competitive pressure from domestic and international brands, SABECO still increased its sales thanks to product diversification and appropriate pricing strategies.

It has also shown positive signs in expanding its distribution channels and improving the efficiency of its supply chain. In the quarter, sales volumes increased thanks to a strong promotional campaign and the recovery of the domestic consumer market. At the same time, an effective cost management strategy helped significantly reduce expenses and improve gross profit.

In addition to internal factors at the enterprise, the strong recovery of the consumer market is also one of the more favourable factors for SABECO to maintain its growth momentum in the final quarter of 2024 and beyond.

GDP growth and strong performance in the processing and manufacturing industry is a bright spot for the country’s economy. The recovery of domestic consumption and production demand, along with the strong growth of tourism, has also positively contributed to the growth of the trade and service sector.

The company is continuing to launch new products to sit alongside its familiar classics

SABECO has been well-prepared to seize the opportunity of recovery of the domestic economy as well as expand to the international market. In 2024, it has focused on developing new products and enhancing its brand image to attract more young customers, especially those in large urban areas.

The company’s higher-end beer products are performing well, marking an important step in its product diversification strategy. At the same time, it is also focused on environmentally friendly products, anticipating green consumption trends.

Meanwhile, SABECO is planning to make a public offer to acquire over 37.8 million shares of Sabibeco, which represents 43.2 per cent of its total voting shares. Priced at VND22,000 (87 US cents) per share, this acquisition would require an estimated VND832 billion ($32.9 million), funded through SABECO’s equity and other legitimate financial resources.

This offer reflects a premium over Sabibeco’s current market value, as trading of its shares remains restricted.

The public offer is active from October 31 to December 25, during which SABECO reserves the right to adjust the bid price if needed. However, it may withdraw the offer if certain conditions are not met, including if less than 28.7 per cent of the shares are tendered or if Sabibeco reduces its voting shares, issues new shares or convertible instruments, or sells significant assets.

SABECO currently holds a 16.4 per cent direct stake in Sabibeco, with its subsidiary Binh Tay Liquor JSC owning an additional 6.3 per cent. A successful acquisition would boost its direct stake in Sabibeco to 59.6 per cent, increasing combined ownership for SABECO and its affiliates to 65.9 per cent.

The move would also turn Sabibeco into SABECO’s subsidiary, raising its total number of subsidiaries to 27.

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