Lion Brewery sales surge in 2Q helped by robust exports

Lion Brewery (Ceylon) PLC returned to its peak performance in the three months ended in September (2Q21), predominantly cushioned by robust exports and partly by increased domestic consumption, despite the absence of a tourism sector running at full throttle.

The largest brewer in the country with a thriving export market logged a 22 percent jump in sales during the July-September quarter to Rs.15.1 billion compared to Rs.12.3 billon in the corresponding period last year. 
The company attributed most of this spectacular performance in sales to the robust export performance of its beer, which goes to 25 countries. 

“Whilst business in the local market was adversely affected due to the pandemic, it was satisfying to record a significant growth in exports. Currently, Lion beer is exported to 25 countries and volumes increased by 19 percent during the 1st half whilst profits rose by 32 percent in this segment of the business,” the company said in an earnings release in reference to the results of the first six months as a whole. 

“This was notwithstanding the slowdown in tourism in the Maldives – a substantial market for Lion beer exports during this period. All export growth was organic as new markets were not penetrated during the 1st half,” it added. 

The company remains watchful of the recent re-emergence of the virus for possible implication to the momentum of the company’s performance considering the extent of the spread and the length of the lockdowns.  “If so, the company’s results – whilst not completely unscathed – will continue to remain at what can be considered reasonable levels under very challenging circumstances.” 

The company reported earnings of Rs.13.60 a share or Rs.1.09 billion in the July-September quarter compared to Rs.11.58 a share or Rs.926.6 million in the comparable period last year. 

The company settled about Rs.3.6 billion in loans during the six months to September boding positively for the finance cost. By end-September, Ceylon Beverage Holdings PLC held 52.25 percent stake in Lion Brewery while Carlsberg Brewery Malaysia held 25 percent stake.