Vietnam: Habeco reports $4.1 bln loss in Q1 2020
Brewer Habeco reported a loss of VND96 billion ($4.1 million) in the first quarter, hit by the stringent new drunk driving laws and Covid-19, VnExpress International reported on May 4.
Hanoi Beer Alcohol and Beverage Jsc, which produces Hanoi Beer and Truc Bach Beer, said the loss is almost the same as its first quarter pre-tax profit last year.
Revenues fell 50 percent year-on-year to VND774 billion ($33 million), while operating costs remain mostly unchanged, according to its financial report.
Habeco said Vietnam’s new decree on drunk driving, which imposed stiff penalties, has caused a slump in beer demand.
The pandemic, which caused restaurants, bars and other places of entertainment to close down for much of the quarter, is also to be blamed.
The company’s unsold inventories have risen 18 percent to VND750 billion ($32 million).
Its competitor and the country’s largest brewer, Saigon Beer Alcohol Beverage Corporation (Sabeco), saw first quarter profits fall to a seven-year low of VND720 billion ($31 million).
Market observers said 2020 would be a challenging year for the beer industry because of the same two factors.
The country had consumed 4.6 billion litres of beer in 2019 after rising 10 percent from 2018, but growth could fall to 6-7 percent this year, top brokerage SSI Securities Corporation (SSI) estimated.
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