Results first-take: Attributable profit grew 119% to RMB4.6bn, in line with profit alert and our expectations
- FY21 sales volume decreased slightly by 0.4% y-o-y to 11m KL, inclusive of a 6.9% drop in 2H21 amid COVID-19 impacts. FY21 revenue up 6.2% to RMB33.4bn and surpassed its FY19 level (2H21: down 2%), supported by the increase in average selling price of 6.6% in FY21 (2H21: up 5.2%).
- Gross profit margin increased by 0.8ppt to 39.2%. Attributable profit rose 119% to RMB4.6bn.
- Final DPS for FY21 is RMB0.302 (FY21 interim: RMB0.264). Total payout ratio was 40%. We maintain BUY and will review our TP of HK$72.29 after results briefing at 4pm today.
What’s New
- CR Beer announced FY21 results with attributable profit up 119% y-o-y to RMB4.6bn (2H21: up 1873% to RMB265m), including after-tax disposal gain on land amounting to RMB1.3bn that was booked in 1H21.
- FY21 sales volume decreased slightly by 0.4% to 11m KL. 2H21 volume was down 6.9% y-o-y as a result of lingering COVID impacts.
- Sales volume of “sub-premium and above” segment grew by 27.8% to c.1.9m KL, accounting for 17% of total sales volume (FY20: 13%)
- Average selling price grew 6.6%/5.2% y-o-y in FY21/2H21 due to ongoing premiumization and enhanced product-mix.
- FY21 revenue up 6.2% to RMB33.4bn, above FY19 level with 2H21 revenue contracting 2%.
- Gross profit margin increased by 0.8ppt to 39.2%. Adjusted EBITDA grew 11% to RMB6.6bn.
- Final DPS of RMB0.302 declared; coupled with an interim DPS of RMB0.264, full-year payout ratio was 40% in FY21.
- Featured premium brands (e.g., SuperX, Heineken, Snow Draft Beer and Marrsgreen) have attained double-digit growth in sales volume during FY21. CR Beer continues to expand premium products, with Snow Draft Pure Malt Beer and Heineken 0.0 in the pipeline for FY22.
- Near-term challenges include impacts of COVID outbreaks in China and the price pressure from rising raw material costs, while CR Beer had demonstrated its ability to sustain supportive gross margin last year that also saw cost uptrends.
- Maintain positive outlook for CR Beer and our BUY rating on the counter. We will also review our TP of HK$72.29 with more to follow after results briefing at 4pm today (24 Mar).