The nation’s major breweries on Friday reported weak beer sales for the first half of the year, with the economic slump, tax hikes and diversifying consumer taste conspiring to sap demand.
Kirin Brewery Co., one of three breweries that announced six-month results, said it revised down its full-year earnings outlook to 33 billion yen from the initial 39 billion yen.
Yoshikazu Arai, Kirin’s managing director, said the May tax hike on low-malt “happoshu” dealt a heavy blow to the firm’s first half sales, with the unseasonably cool July weather likely to exacerbate its predicament through the rest of the year.
Combined sales of beer and happoshu over the six-month period dropped 7.2 percent to 430.2 billion yen, the company said. While other alcoholic beverages — particularly Hyoketsu, a canned “chuhai” drink — logged strong growth, they failed to make up for the beer slump.
Yet group net profit during the first half grew 35 percent to 13.93 billion yen, with revenue almost flat at 732.81 billion yen, thanks to mounting sales of nonalcoholic beverages and a cut in promotional costs.
Suntory Ltd. said its beer sales dropped 7.6 percent, while happoshu sales fell 6.1 percent during the six-month period. Combined sales stood at 100.4 billion yen.
“The impact of the happoshu tax hike is more severe than we anticipated,” said Masao Tachiki, Suntory’s senior managing director. “We initially thought the impact of raising the price 10 yen to 145 yen (for a 350-milliliter can) would be diluted as time passed. But it has very strong price sensitivity.”
The company, which derives more than half its revenue from nonalcoholic beverages and its food businesses, said that group net profit for the half-year period nearly doubled to 11.28 billion yen, while revenue fell 2.8 percent to 639.94 billion yen.
The impact of falling beer sales was especially acute for Sapporo Holdings Ltd., whose revenue depends heavily on beer sales.
The maker of Yebisu beer said its group net loss during the first half widened to 13.36 billion yen, following a loss of 6.29 billion yen a year ago, while sales dropped 10.3 percent to 215.58 billion yen.
Combined sales of beer and happoshu dropped 13.3 percent to 144.1 billion yen on a parent-only basis.
Asahi Breweries Ltd. said its unconsolidated beer sales dropped 8.5 percent from a year earlier to 353.1 billion yen. Happoshu sales edged up 0.3 percent to 86.4 billion yen — but fell well short of the company’s target.