Rising Turnover and Revenues at Dreher Breweries
19 October 2012
Budapest, September 25th, 2012 - Dreher Breweries Ltd., Hungary's number one beer producing and distributing company, has closed another successful season. The 158-year-old breweries are expecting 40 billion forints in revenues, 3 more than last year's 37 billion. The company, which produces nearly 2 million hectolitres of beer per year, has seen its turnover rise last year, following a steady decrease which was observed in the beer industry as a whole. This positive trend continued this year. The increase can be explained by the broadening of its low-priced products segment, which is due to the economic crisis, but also by the company's successful strategy in the catering industry, which was explained at the Dreher Breweries press conference.
Twenty years ago, 10 million hectolitres of beer were consumed every year in Hungary, a number which gradually dropped to 7 million, with the demand continuously decreasing ever since. This negative tendency reversed last year and as the market continued growing this year, we can speak of a definitive change in trends. Dreher Breweries Ltd., Hungary's number one beer producing and distributing company, followed the beer industry's trends and its sales increased compared to last year's, as we learned at the company's season closing economic press conference.
Tamás Glattfelder, the financial and administrative director of the breweries, emphasised that Dreher Breweries is calculating its figures with overlapping fiscal dates (April 1st - March 31st) and thus cannot present its final results, but according to estimates so far, the breweries are expecting 40 billion in revenues. This is far better than last year's 37 billion. The director underlined that Dreher Breweries paid 12 billion forints in excise tax, 6 billion forints in value added tax (VAT) and nearly 2 billion in wage-related and other taxes, i. e., it has contributed to the Hungarian budget a total of 20 billion forints. Ninety-three hundred employees have a secure living, thanks to their job at the breweries, and there are another 4600 jobs in catering and 610 in retail.
The 7% increase in volume is partly due to the market's trends and partly to Dreher Breweries' successful programmes aimed at the catering industry. Thanks to a great season, consumption of draught beer increased by 8% between April and August compared to the same period last year and Arany Ászok has become the most important brand in this segment.
It became obvious during last year's and the current season that beer sales are more and more focused on low-priced products, which is why the increase in volume is not directly proportional to the financial results. Low-priced beers represent 30-40% of the market, while premium products make up 15% of it. The rest of the market is made up of medium-priced products.
Lóránt Sándor Kovács, the company development director said, regarding company strategy, that owing to the success of the catering sector, efforts in this direction should be pursued. Dreher Breweries will reinforce its industry-related programmes to help raise the popularity of draught beer, which is the best quality format in the beer industry. The presence of flavoured beers is a new challenge and possibility in the Hungarian and foreign beer market. This segment represents nearly 7% of beer consumed yearly and shows that consumers are curious and demand specialties, which is why the company decided this year to enter this market. Kovács also mentioned, concerning the company's sustainable development strategy, that nearly 50% of its beer is sold in recyclable, rechargeable packaging (30% of it in barrels and 70% in recyclable bottles), which is a unique rate in the industry.
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International background for Dreher Breweries Ltd. is provided by the second biggest beer producing enterprise in the world: the SABMiller group, which is present on 6 continents in over 75 countries. The group has defined 10 main development areas in order to contribute to sustainable development and Dreher Breweries has taken an active part in this initiative by creating and completing local programmes. These 10 areas are: Fighting against irresponsible alcohol consumption, developing environmental-friendly water management, reducing energy usage and carbon dioxide emission, recycling and re-using of packaging, responsible waste management, support of enterprise development in the chain of value, community engagement, support of anti-HIV/AIDS campaigns in concerned areas, respect of human rights and encouraging transparent and ethical corporate practises.
This SABMiller subsidiary news release has been translated from its local market language to English language for publication on www.sabmiller.com. We have attempted to provide an accurate translation of the original material but due to the difficulties of translation slight differences may exist.
Note, the news release was first published in its local market on 25th September 2012.