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recently, major beer giants have submitted their “answer sheets” for the first half of this year.

judging from the 7 representative beer companies that have disclosed their semi-annual results for 2024, including china resources beer, budweiser asia pacific, tsingtao beer, yanjing beer, chongqing beer, zhujiang beer, and huiquan beer, the overall performance of each beer company in the first half of this year was mediocre. among them, the sales volume and revenue of china resources beer, budweiser asia pacific, and tsingtao beer all declined; while yanjing beer, chongqing beer and other 4 manufacturers achieved double growth in revenue and net profit.

"the beer industry has shown new characteristics this year. first, new brands have grown significantly, while giant manufacturers have 'slowed down'. second, craft beer has grown rapidly and there is still a lot of room for growth in the future. in contrast, traditional beer has shrunk due to factors such as changes in the catering market, and the market has declined significantly. in addition, the catering market is no longer the only major channel, and the trend of online channels in the entire beer market has become more prominent." bao yuezhong, a senior retail industry expert, told the "daily economic news" reporter.

as beer enters the era of stock competition, high-endization has become a new engine for major beer manufacturers to drive performance growth. however, with the "close combat" of high-endization, how to seize the dividends of high-endization for a long time and seek new growth has become a new question for beer manufacturers.

beer manufacturers used to compete mainly for restaurants, but now they are competing for valuable incremental customers. the picture shows staff serving beer to tourists at the harbin international beer festival. xinhua news agency

industry slowdown and performance differentiation

from the perspective of the entire market, the domestic beer market has entered an era of "slow growth". among the seven beer companies counted by the reporter of "daily economic news", the three leading manufacturers, china resources beer, tsingtao brewery, and budweiser asia pacific, contributed more than 70% of the sales. however, although these three companies support half of the beer market, their sales have declined in the first half of the year, with year-on-year declines of 3.4%, 7.8%, and 6.2% respectively.

in contrast, the sales of four beer companies, including yanjing beer and chongqing beer, maintained year-on-year growth in the first half of this year. chongqing beer had the largest year-on-year growth of 3.3%, while zhujiang beer grew by 1.4%, and the other two grew by less than 1%.

at the same time, the revenue growth of beer giants has also slowed down significantly. in the first half of this year, the revenue of china resources beer, tsingtao brewery, and budweiser asia pacific all exceeded 20 billion yuan, but the revenue of the three manufacturers declined compared with the same period last year, down 0.5%, 7.06%, and 4.3% year-on-year respectively. the other four beer manufacturers in the second tier of revenue all maintained single-digit revenue growth, among which yanjing beer and zhujiang beer both achieved revenue growth of more than 5% year-on-year in the first half of this year.

although there is a clear differentiation in sales volume and revenue, in the first half of this year, except for budweiser asia pacific, the other six beer manufacturers achieved year-on-year growth in net profit.

data shows that the net profits attributable to the parent companies of china resources beer, tsingtao brewery, and budweiser asia pacific in the first half of this year were 4.705 billion yuan, 3.642 billion yuan, and 514 million us dollars, respectively, with year-on-year growth rates of 1.2%, 6.31%, and -5.91%, respectively. although the net profit volume of yanjing beer, zhujiang brewery, and huiquan beer is far less than that of the above three companies, their net profit growth rate exceeded 35% year-on-year.

as for the reasons for the performance changes in the first half of the year, many beer manufacturers said that it was due to the weak recovery of consumption and the impact of extreme weather. according to reports, zhao chunwu, president of china resources beer, said at the performance conference that the domestic rain belt was changing from july to august, and the impact on each beer company was also different, but the overall environment was improving, and the beer market was expected to improve in the second half of the year.

gross profit margin continues to grow

under the competition for existing market share, major beer manufacturers are accelerating their efforts to move towards high-end products, and high-end beer products have become the "main force" of each company's performance.

the financial report shows that in the first half of this year, the sales volume of mid-range and above beers of china resources beer accounted for more than 50% for the first time in the first half of the year. among them, the sales volume of high-end and above beers increased by more than 10% compared with the same period last year, and the sales volume of heineken, lao xue and other products increased by 20% year-on-year; the sales volume of mid-high-end and above beers achieved a single-digit growth year-on-year.

the main brand of tsingtao beer achieved a total sales volume of 2.61 million kiloliters in the first half of this year, of which mid-to-high-end products achieved sales volume of 1.896 million kiloliters, accounting for more than 70%. when receiving investor research, zhujiang beer said that in the first half of 2024, the company's high-end beer product sales increased by 14.30% year-on-year, and it will promote the high-end and younger brand around "beer +".

in terms of revenue data, the revenue of mid-to-high-end products of major beer manufacturers continued to grow in the first half of this year. data shows that in the first half of this year, the revenue of yanjing beer's mid-to-high-end products exceeded 5 billion yuan, accounting for 68.54% of the main business revenue compared with the same period last year; chongqing beer's high-end product revenue was 5.263 billion yuan, a year-on-year increase of 2.82%; zhujiang beer's high-end product revenue exceeded 2 billion yuan, a year-on-year increase of 17.19%, and its gross profit margin also increased compared with the same period last year.

with the help of mid-to-high-end products, beer manufacturers have also maintained high gross profit margins. from the four manufacturers that disclosed gross profit margin data, china resources beer, tsingtao beer, yanjing beer, and zhujiang beer all maintained gross profit margins of 40%, and all increased to varying degrees compared with the same period last year.

in bao yuezhong's view, the high-end trend of the beer market can still be maintained for a while, but this growth will not expand indefinitely. "the chinese beer market is still a stratified market, and high-end trends will definitely reach their ceiling in the future. after high-end trends reach a certain level, high-end and mass-market products will form a balance," he said.

the high-end track is becoming increasingly crowded

in the past two years, faced with the continuous iteration of consumer demand and changes in people's consumption concepts, the domestic beer market is entering an era of "slow growth".

according to reports, in 2023, china's beer industry enterprises above designated size will achieve a total beer output of 35.555 million kiloliters, a year-on-year increase of 0.3%. in the first half of this year, enterprises above designated size in the beer industry achieved a total output of 19.088 million kiloliters, a year-on-year increase of 0.1%.

"the beer market may still face pressure in the second half of the year, and some companies will face the risk of elimination in the future. the market will undergo major structural changes, and new business formats, new models, new products and companies will emerge, but it will basically not decline as severely as in the second quarter (of this year). the third quarter should gradually stabilize." bao yuezhong remains cautiously optimistic about the second half of this year as a whole.

as competition continues to intensify, the high-end track is becoming more crowded, and the traditional beer market is eager for thorough innovation, otherwise it will be difficult to increase growth. in an interview with the daily economic news, fang gang, a beer industry expert, admitted that with the acceleration of high-end beer manufacturers, it is not ruled out that the competitive landscape of the industry will change in the future, and the market share of the top five beer manufacturers may decline.

on the other hand, in addition to high-end development, facing the rapidly emerging craft beer market, major beer manufacturers have also entered the market and tried to seek new growth.

the "2022-2026 china craft beer industry competition landscape and development trend forecast report" released by china research institute shows that in the past five years, the number of newly registered craft beer-related companies in my country has continued to surge, with an average annual growth rate of 95%. industrial and commercial statistics show that from 2013 to 2020, craft beer achieved a compound annual growth rate of 36% against the trend.

according to reports, in 2023, chongqing beer holding's subsidiary carlsberg chongqing beer co., ltd. acquired beijing shoubrew jinmai trading co., ltd. and other assets, and obtained ownership of 57 trademarks in the "beijing a" series. earlier this year, yanjing beer said at a performance briefing that it would lay out a new craft beer production base company and launched the lion craft beer exclusive brand.

"craft beer is one of the new growth areas that major beer manufacturers are increasing their investment in. it still has a lot of room for growth in the chinese market. therefore, both leading brands and new brands are making early arrangements in the craft beer field. however, the proportion of craft beer in the entire market in the future will not be very high." bao yuezhong said.

in bao yuezhong's view, whether it is the current high-end beer market that beer manufacturers are investing heavily in, or the rapidly rising craft beer market, these adjustments are behind the key changes in the competition in the beer market. "beer manufacturers used to compete mainly for restaurants, but now, competing for valuable incremental customers has become the main direction. according to the changes in consumer purchasing methods, capturing customers and managing customers is the direction of the current transformation of beer marketing."

daily economic news