Higher sin taxes weigh on San Miguel Brewery earnings

The company says the weak peso also had an impact on its foreign debts

MANILA, Philippines – The brewery unit of diversified conglomerate San Miguel Corporation said Friday, February 7 its 2013 earnings fell due to higher “sin” taxes and the impact of a weaker peso.

San Miguel Brewery Inc. said its net income in 2013 dropped 17% to P12.5 billion from P15.1 billion in 2012.

It said net sales revenue fell to P75.1 billion from P75.6 billion, with cases of beer sold reaching 204 million.

“Higher excise taxes imposed in January 2013 took a toll on beer sales volumes resulting in a 9% decline for the year as San Miguel Brewery was forced to raise selling prices on its major beer brands,” the company said. (READ: Higher booze, cigarette prices as sin tax law takes effect)

It also said that net income would have only declined by 3.4% “without the impact of the foreign exchange fluctuations on the company’s dollar-denominated term facility and without non-recurring items in 2012.”

The government raised taxes on so-called sin products, tobacco and alcohol, to raise additional revenues for health care and reduce consumption of the products among the poor and young. (READ: A year of sin tax: Too early to assess health impact– Rappler.com

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