Malaysia: Heineken Malaysia’s FY21 core net profit up 40% yoy

Heineken Malaysia Bhd's financial year 2021 (FY21) core net profit of RM245.7 million, representing a 40 per cent year-on-year (YoY) growth, came in within Hong Leong Investment Bank Bhd's expectation, The New Straits Times reported on February 17.

HLIB said the growth was above its and consensus estimates at 105 per cent and 108 per cent respectively.

It added that the commendable results were due to Heineken Malaysia's efforts in right-sizing the organisation and cost base, while at the same time, pushing through effective commercial and marketing campaigns to boost top line recovery.

"Its performance has yet to return to pre-Covid levels and we expect gradual recovery to continue," said HLIB.

The firm expects recovery to continue, despite the recent surge in cases, given that 51.0 per cent the government has indicated that there will be no more lockdowns going forward.

"The rate of recovery would very much depend on the consumers' behaviour, as consumers adapt to a new normal and potentially avoid large events and mass gatherings for the time being."

HLIB said the management would keep a close eye on input costs and did not rule out further price adjustments in the future to compensate higher costs, if need be, in light of the current inflationary pressures.

"We maintain a hold call with a target price of RM22.50."

Heineken Malaysia posted positive revenue and profit for the year ended December 31, 2021 (FY21) as the brewer recovers following the reopening of the economy in Malaysia during the year.

Revenue increased 12 per cent to RM1.98 billion from RM1.76 billion posted, mainly due to improved revenue management.

Its net profit increased 59 per cent to RM246 million from RM154 million recorded previously.

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