Commonwealth Brewery’s revenue flat during first quarter
Commonwealth Brewery Limited (CBL) released its first quarter financial statements on the Bahamas International Securities Exchange (BISX) yesterday, revealing that its revenue was flat during the quarter.
The statement notes that compared to 2018’s first quarter numbers, 2019’s first quarter might have realized moderate growth had the company not closed for four days in March to roll out its new enterprise resource planning (ERP) system.
The company said the cross-section of the ERP implementation, the presentation of promotions, expenses and one-off restructuring cost the operation a net loss of $866,258 for the quarter.
“The strategic actions undertaken thus far by CBL were pre-planned and forecasted to yield growth by moderating cost development versus top-line while continuing to invest in our key brands,” the statement points out.
In terms of CBL’s other operating expenses, the company said in its statement that it is preparing to become more streamlined in its operations in order to deliver increased value and efficiency.
“Increases in the three principal operating expense lines, compared to the first quarter of 2108, relate to the restructuring and realignment exercise in process, which had an impact of $1.5 million,” the statement notes.
“In addition, the shift in consumer preferences and rebranding of the Kalik Light portfolio resulted in a net increase of $1.1 million.
These had been anticipated in our plan for 2019. The realization of planned efficiencies are expected have a positive impact in the months to come.”
The company said last month that the increase of the value-added tax (VAT) rate to 12 percent also impacted Commonwealth Brewery Limited’s (CBL) revenue growth.
“There was a change in consumer spending power and disposable income due to the increase of VAT (value-added tax) from 7.5 percent to 12 percent,” said Managing Director of CBL Jürgen Mulder in a statement in May.
“And we did not alter the prices of our main brands, mainly Kalik, and absorbed all residual impacts of the VAT increase.”
CBL’s financial statement shows a year-on-year change in revenue from $133 million in 2017 to $134 million in 2018.
The statement shows that operating expenses, namely raw materials, consumables and services increased by $7 million year-on-year.
The company’s total net profit went from $18.7 million in 2017 to $6.3 million last year.