In the turbulent post epidemic era, Cr beer has a new way to pursue growth. At the 2022 interim performance meeting held this afternoon, Hou Xiaohai, chief executive officer of China Resources beer, revealed that the company is actively exploring the beer consumption channels and scenarios that are accelerating under the epidemic, such as e-commerce, o2o home platform, Helen’s and other pubs.
He also revealed that in the difficult situation in the first half of the year, it was “not easy” for China Resources beer to maintain its growth, but he also admitted that the management was “still not satisfied” with the growth of high-end products. Next, let’s take a look at the latest situation of this Chinese beer leader.
According to the 2022 semi annual report released by China Resources beer today, the company’s comprehensive turnover in the first half of the year was 21.113 billion yuan (RMB, the same below), up about 7% year-on-year. Excluding special items such as profit from land transfer in the same period last year, Cr beer’s profit before interest and tax in the first half of the year was 5.159 billion, up 17% year-on-year. In terms of categories, high-end is still the main driving force to drive sales. The financial report pointed out that the epidemic in the first half of the year had a great impact on beer sales. The group’s overall beer sales fell by 0.7% year-on-year to about 6295000 kiloliters, which was better than the overall industry level. Among them, the sales volume of medium and high-grade beer and above was about 1142000 kiloliters, with a year-on-year increase of about 10%.
Hou Xiaohai said at the meeting that the performance in the first half of the year showed three characteristics. The first is the V-shaped performance trend with ups and downs. “In January and February, there was a very good starting point, and in March and April, there was a relatively low ebb, especially in April, when it reached the lowest point, then it began to rebound in May, and then reached the high point in June.”. Second, the pressure of “three mountains”. “In the first half of the year, we faced the three mountains of cost, epidemic and economic downturn. It was the most difficult half year. In this half year, we experienced multiple impacts from the three mountains. It should be said that it is not easy to maintain steady growth.” Hou Xiaohai said. Third, the main consumption channels of beer are restricted, which affects the high-end. “The development of our high-end liquor has maintained a certain speed, but there is still a certain gap from our expectations. This reflects that the Chinese beer market has been restrained by the epidemic and the economic downturn, and our high-end liquor has been restricted to a certain extent.” Hou Xiaohai said, “without the impact of the epidemic in March and April, I believe the growth of products above the second highest level in the first half of the year will be very good.”
In order to reduce the potential impact of the epidemic, Cr snowflake has paid more attention to the rapidly developing new beer channel. “After the outbreak of the epidemic, the channel of instant drinking was greatly restricted, and non instant drinking developed rapidly.” Hou Xiaohai said that although non current channels such as e-commerce will not occupy the main part of beer consumption in a short time, it is “possible to achieve a proportion of 5% ~ 10% in the near future”. To this end, China Resources beer began to further subdivide the non cash market last year, and increased the development of o2o, community group purchase, chain convenience stores and e-commerce. “We have also made great progress over the past year.
“In the second half of last year and the beginning of this year, we have completed the price adjustment for this cost increase. The current price increase range and amount can cover the current increase in the cost of raw materials and packaging materials.” He said. According to the above financial report, the overall average sales price of China Resources beer in the first half of this year increased by about 7.7% year on year. On the other hand, Hou Xiaohai mentioned that the continuous high temperature this summer can stimulate beer consumption. “Especially in the provinces along the Yangtze River, it should be said that the high temperature, long duration and less rainfall have greatly supported our beer consumption.” He said, “we hope to achieve double-digit growth in July and August, which will be very beneficial to the development in the second half of this year.” “Therefore, we predict that in the second half of the year, there will be a better growth in sales volume, a better increase in profits, a better drop in costs, and a better recovery in beer consumption. In the whole year, we think that we are still full of expectations, and it is possible to achieve the three growth of sales volume, profit growth, income growth, and double-digit growth of high-end liquor.” Hou Xiaohai said.
However, he also pointed out that we should still pay attention to the epidemic situation and the uncertain factors of the global environment. China Resources beer will continue to “live a tight life” in the second half of the year and the next two years. “This year, there is an important idea in the whole country, that is, ‘living a tight life’. We have also made specific plans and introduced many projects to promote the work of the whole company. Through the efforts in the first half of the year, our advertising, administrative expenses and sales expenses have decreased compared with the same period of last year. I believe this decline will continue in the second half of the year. Because living a tight life is our annual strategy, it will not be difficult in the second half of the year because of the situation in the first half of the year If the year gets better, we won’t have to live a tight life. ” Hou Xiaohai said that China Resources beer still has huge room for adjustment in advertising and sales expenses. “In the past few years since the outbreak of the epidemic, our advertising and sales expenses have been relatively abundant. Compared with our competitors, we have an overwhelming (advantage) in advertising investment, so there is actually a lot of room for improvement.” He said that as China Resources beer has accumulated development momentum in the high-end market in the past few years, it will adjust its advertising expenditure and cost input according to different stages of high-end liquor and brand development in the next three years.
It can be seen that China Resources beer, which is aggressively attacking the high-end market, is trying to draw a successful conclusion to 2022 and make preparations for entering the final stage of the “3 + 3 + 3” strategy next year. As introduced by the snack generation, the strategic starting point of the “3 + 3 + 3” is 2017, and specific goals and key work are formulated every three years. From 2023 to 2025, the strategy of Cr snowflake is “high-end victory and excellent development”. Hou Xiaohai said that one of the company’s goals in the last three years is to “win the high-end”. “The sales volume and share of our high-end products should reach the top 1 or top 2 level of the industry, and gradually equal to our beer share in the Chinese market. We currently have 34% market share in the Chinese beer market, and we hope that the high-end market share can reach 20% ~ 30% in the last three years.”
Under this objective, China Resources beer has divided different types of high-end Chinese beer markets and formulated targeted strategies and objectives. First of all
“Our investment in Baijiu is mainly to invest in some local leading enterprises.” Hou Xiaohai said today that through cooperation with Baijiu enterprises, China Resources beer hopes to explore a two-way enabling mode for beer and Baijiu, including channel sharing, cost lean, mutual building of sales models, mutual learning of sales teams and double input of management experience. “These methods can promote beer to absorb some experience and ability of non beer, and provide impetus for the high-end and further branding of beer.” He said, for example, the common group consumption mode of Baijiu is rarely used in beer, but it can also be used in high-end beer, such as the “Li” listed last year. At the same time, China Resources beer can export experience to cooperative companies, such as channel management, product management cost lean, and terminal empty bottle wine management mode. “Our goal is to find the basic method of enabling this year. Next year, there will be a version 2.0 method to explore the basic mode of enabling Baijiu and beer in 2-3 years.” Hou Xiaohai said. However, he also stressed that the two Baijiu enterprises that China Resources beer participated in currently maintain independent operation and operation. “They have their management rights. As shareholders, we may provide some (Management) candidates, which is also the obligation of shareholders.”.
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21 billion! China Resources beer bright China news, CEO’s latest talk today on the comprehensive growth of the whole year and cross-border Baijiu