SABECO outlines growth plans for 2024

April 25, 2024 | 16:15
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Tan Teck Chuan Lester, general director of Saigon Beer – Alcohol – Beverage Corporation, gave the result and plans of the company at its AGM on April 25 in Ho Chi Minh City.
Not waiting for the 'storm' to pass, SABECO learning to 'dance in the rain'
Lester Tan, general director of SABECO

Leveraging market insights and mindful of global and Vietnam's economic forecasts, SABECO has outlined ambitious growth objectives for 2024, while pushing on commercial excellence, production efficiency and promoting environment, social and governance (ESG).

2023 performance

In 2023, Vietnam's beer market faced significant challenges, including rising raw material costs as a result of disruptions in the global supply chain, rising inflation rates, and interest rates, and reduced consumer spending amid the economic recession, as well as the stringent enforcement of relevant policy.

Vietnam has recently witnessed a remarkable decrease in beer consumption, especially in the closing months of 2023, according to the General Statistics Office of Vietnam.

According to the 2023 Consolidated Financial Report, SABECO recorded VND30.5 trillion ($1.27 billion) in revenue and $177 million in profit, representing 76 and 74 per cent respectively of the targets set out at the AGM 2023.

Reflecting on these business outcomes, the Board of Directors suggested and approved a final dividend rate of 20 per cent, resulting in a 35 per cent annual dividend rate for shareholders.

“While this result represents a 23 per cent drop from a year ago, we remain a healthy and profitable company that continues to deliver significant dividends to our shareholders. Changes are made so that regardless of changing market dynamics, Bia Saigon will stand to remain the leading beer brand in Vietnam, ” said Lester Tan, SABECO general director.

SABECO has concentrated on three key areas: commercial excellence, supply chain efficiency, and ESG.

Commercial Excellence focuses on a series of culture–culinary events, such as Dem Saigon, Vung Tau Beerfest, The Chill Fest, “Sao Cua Moi Cuoc Vui” singing competition and the Lunar New Year campaign “Don Tet Rong, Nhan Boi Loc.”

These activities have not only helped SABECO strengthen their connection with the consumers but also fostered tighter bonds local distributors and stakeholders in its value chain, thereby increasing sales chances.

Supply Chain Efficiency revolves around cost-saving and effective production initiatives. SABECO also completed a Warehouse Master Plan project to enhance the management capability of the supply chain and accelerate the route-to-market process.

In terms of ESG, in 2023 the company established the Nomination and Remuneration Committee and the Sustainability and Risk Management Committee, to support and ensure that all areas of operation and production follow the ESG objective set by the group and Vietnam. Furthermore, the group installed a rooftop solar power in nine of its breweries, in parallel with fostering the environmental impact control protocol and corporate social responsibility to generate positive socioeconomic values.

Strategically following these three key pillars has helped the company achieve outstanding recognition in 2023.

Bia Saigon retains the leading position in the market. Effectiveness enhancement in production management helped boost cost efficiency, and Bia Saigon’s product line, Bia 333 won gold and silver medals from the Beverage Testing Institute.

Renewable energy adoption helped the corporation to reduce electricity usage to approximately 25 million kWh, equivalent to 18,000 tonnes of CO2 emission reduction.

ESG initiatives and Corporate Social Responsibility have brought awards, such as “Outstanding Enterprise for Employee,” “Top 100 Sustainable Businesses in Vietnam,” “Boards of Directors Committed to Corporate Governance Best Practice,” the “Top 50 Best Listed Companies in Vietnam.”

Not waiting for the 'storm' to pass, SABECO learning to 'dance in the rain'

Growth priority in 2024

Considering favourable opportunities such as Vietnam's golden population structure, rapidly growing income levels, as well as the evolving policy landscape and global economic projections for 2024, the company sets a target of almost 1.4 billion in net revenue, and $190 million in profit in 2024, an increase of 13 and 8 per cent, respectively, compared to 2023.

To attain the objectives for 2024, SABECO is steadfast in reinforcing its three areas of focus: commercial excellence, supply chain efficiency, and ESG.

Koh Poh Tiong, chairman of the Board of Directors said, “This year, the board has prioritised the corporation’s sustainability and risk management agenda through the newly established Sustainability and Risk Management Committee, which guide the management team ensuring the effective implementation of ESG objectives while working closely with the board and audit committee to ensure risk management systems are implemented effectively, safeguarding the interests of our shareholders.”

“We look forward to your continued support and you being part of our growth journey to reach greater heights together,” he said.

Ministry of Finance recognises SABECO's outstanding budget contributions Ministry of Finance recognises SABECO's outstanding budget contributions

By ensuring the dual mission of profitability and sustainability Saigon Beer-Alcohol-Beverage Corporation has been honoured for its contribution to the budget during the pandemic peak in Vietnam.

SABECO: 2023 journey of community development SABECO: 2023 journey of community development

By continuously supporting the younger generation to develop its talents, and spending large sums on activities for its staff, SABECO is showing its relentless sustainable development efforts and making positive contributions to the community.

SABECO community initiatives continue to pick up the pace SABECO community initiatives continue to pick up the pace

Through community programmes with deep impact, Saigon Beer-Alcohol-Beverage Corporation has reaffirmed its commitment to generating positive socioeconomic values in localities.

Beverage giant SABECO thirsty for $190 million profit this year Beverage giant SABECO thirsty for $190 million profit this year

Saigon Beer-Alcohol-Beverage Corporation (SABECO) has released reports ahead of its 2024 AGM, which will be held on April 25 in Ho Chi Minh City.

By Nguyen Huong

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