Chinese liquor and beer firms report mixed mid-year earnings

Major Chinese beverage and liquor companies reported mixed mid-year financial results, reflecting shifting consumer demand and economic pressures within the sector.

Jinshiyuan reported a decline in both revenue and net profit for the first half of the year, marking its largest semi-annual revenue drop in recent years. While the company saw a recovery in the second quarter with revenue of 2.113 billion yuan, it faces challenges including rising inventory levels, which reached 7.14 billion yuan, and an increase in short-term borrowings to 1.2 billion yuan. High-end product sales also saw a significant decline, particularly in its core Jiangsu market.

China Resources Beer reported a 10.7% year-on-year decrease in mid-year net profit to 5.17 billion yuan, despite a slight 1.2% increase in total revenue. While beer sales volume rose by 1.7%, the company's baijiu (white spirit) business revenue fell by 27%. Management noted that while high-end beer segments showed growth, overall industry sentiment remains cautious due to sluggish consumption trends observed in the second quarter. The company aims to increase its annual dividend payout ratio to at least 55% in the long term.