PETALING JAYA: Heineken Malaysia Bhd is cognisant of its prospects in 2022, given the recent spike in new Covid-19 cases, continued closure of international borders resulting in lower arrivals of tourists, escalating input costs and various logistics challenges posed by the pandemic.

       In an online press briefing, the brewer’s finance director Karsten Folkerts said the group “will look into further price increases in 2022 if the input costs continue to rise”.

       In its fourth quarter ended Dec 31, 2021 (Q4’21), the group saw price adjustments for certain products to compensate for rising input costs.

       Managing director Roland Bala clarified that the price increases in Q4’21 were “not significant, and were only to cover the increase in raw material costs”.

       “We will monitor this very closely. It is very important for us to protect the long-term survival of the business,” said Bala.

       For Q4’21, the group posted a 76.9% year-on-year (y-o-y) jump in net profit to RM95.85mil while revenue was 33% higher y-o-y at RM692.34mil.

       In a statement, the brewer said the growth in Q4’21 was mainly due to a higher sales volume, driven by the easing of Covid-19 restrictions and earlier festive sell-in for Chinese New Year 2022.

       For the full financial year 2021 (FY21), the group posted a 59.3% y-o-y jump in net profit to RM245.7mil while revenue was 12% higher at RM1.98bil.

       The group has proposed a single-tier final dividend of 66 sen per share, to be paid on July 28, 2022. This would bring the total dividend for FY21 to 81 sen per share.

       The group said in FY21, there was improved revenue management and it took bold moves to right-size the organisation and cost base, while driving revenue growth through effective commercial and marketing executions.

       “Our courage to right-size our organisation and front-load our cost and value initiatives during the crisis has contributed significantly to our performance. Despite having to stop our operations for 11 weeks in 2021, which is four more than the seven weeks we paused for in 2020, the team pulled together various strategic initiatives to unlock efficiencies to help us overcome the many challenges.” said Bala.

       He also welcomed the government’s decision not to increase excise duties on beers and stouts in Budget 2022, as any hike in the excise rates will further fuel illicit alcohol demand.

       “As it is, Malaysia’s excise rate for beers and stouts ranks second highest in the world. Illegal trade and smuggling have caused huge tax revenue losses, disrupted legitimate businesses and risked exposing consumers to cheaper and unregulated illicit alcohol,” said Bala.

       He pointed out that compared with pre-pandemic levels in FY19, the group’s revenue and profit before tax in FY21 had dropped 15% and 22%, respectively, which indicated that its business was still under the recovery phase.

       “We will continue to navigate the challenging external environment by adapting to the new market reality, ensuring the safety of our people, keeping a tight rein on costs and staying focused on our strategy to accelerate our business recovery.

       “As the health and safety of our employees remained our top priority, the group participated in the government’s vaccination programme to enable 100% of our brewery’s essential workforce to be vaccinated.

       “The group continues to accelerate the booster dose amongst its employees,” added Bala.