Filipinos stocked up on beer and spirits in June as the coronavirus lockdown eased, based on San Miguel Corporation’s (SMC) beer and spirits subsidiaries earnings report. However, liquor bans and higher taxes on beer still drastically affected the company’s bottom line for the 1st half of the year. 

San Miguel Brewery (SMB), the country’s top beer manufacturer, ended the 1st half of the year with P42.8 billion in revenues and a net income of P5 billion.

SMB’s press release did not state the percentage change, but based on last year’s press release, the company ended the 1st half of 2019 with net sales of P70.28 billion and net income of P13.26 billion. 

This means that SMB’s revenues and net income in the 1st half of 2020 fell by 64.2% and 62.3%, respectively.

“Domestic operations volumes were lower than in the same 6-month period last year, due to the implementation of the ECQ (enhanced community quarantine), liquor bans, the extended closure of beer selling outlets, as well as the imposition of higher excise taxes on beer products,” SMC said.

SMB also saw a drop in sales in its international markets like Indonesia due to lockdowns.

Hong Kong, Vietnam, and its export markets, however registered favorable results.

Despite SMB’s earnings dip, SMC president and chief operating officer Ramon Ang is confident that the beer and spirits business will recover in the 2nd half.

“We have been working steadily to adapt to the new normal, and adjust our operations where needed, to better serve the market during these challenging times,” Ang said.

“Despite the declaration of a new, two-week MECQ (modified enhanced community quarantine) by government, I believe we’re in a better position now to build on our gains for the rest of the year and beyond. The strong demand we’re seeing is also a big encouragement.”

SMB has turned to its digital platforms to sell and promote products.

It also implemented “cost management and tighter business controls to sustain positive profit level and protect margins.”

Ang previously said SMC’s major investments – including putting up of new breweries in Tagoloan, Misamis Oriental, and Sta Rosa, Laguna – will continue, in order to help boost the Philippine economy and generate new jobs. (READ: San Miguel to buy P500 million worth of protective wear for health workers) – Rappler.com