The decision, announced at the annual shareholders’ meeting on Friday, caught investor attention due to the fact net profit declined 11 per cent in 2018, its first drop since 2013.

Sabeco reported net revenue of VND35.95 trillion (US$1.54 billion) in 2018, up 5 per cent over 2018 and surpassing the yearly target by more than 2 per cent. However, its profit after tax dropped 11 per cent on-year to VND4.4 trillion (roughly $189 million).

Sabeco witnessed big changes to its management board last year, with a representative of Vietnam Beverage, an indirect subsidiary of Thai Beverage (ThaiBev) controlled by tycoon Charoen Sirivadhanabhakdi, joining its executive board in the second quarter.

The company paid total 35-per-cent cash dividend last year worth more than VND2.2 trillion, of which ThaiBev received VND1.2 trillion. With the higher dividend rate, expected to pay this year, Sabeco will pay an additional VND960 billion and ThaiBev will collect an extra VND515 billion.

Sabeco’s undistributed profit was estimated at VND6.7 trillion after the dividend payment, but the company still faced the risk of being forced to pay tax and fines worth VND3.14 trillion from the HCM City Tax Department for violations.

2019 plans

Sabeco has set higher targets for 2019 with net revenue of VND38.87 trillion ($1.7 billion) and net profit of VND4.7 trillion ($202 million), up 7.5 per cent and 6.7 per cent year on-year, respectively.

The dividend rate is planned at 35 per cent.

Neo Gim Sion Bennett, Sabeco’s general director, has maintained a positive outlook for Viet Nam’s beer market with a growth rate of 5 per cent over the next five years.

Sabeco plans a 6-per-cent increase in output to more than 1.9 billion litres in 2019. Last year, nearly 1.8 billion litres of Sabeco’s beer were consumed, up 0.3 per cent year-on-year.

The company said it would invest to raise the capacity of sales teams and distribution networks rather than applying discounts, emphasising the policy of maintaining stable prices throughout the system.

Sabeco was concentrating on the domestic market and would strengthen its brand before reaching out to the world, the company representative said at the meeting.

Regarding the intention of buying more shares in Sabeco, ThaiBev said it was satisfied with the current ownership and if more room was available, it would consider the move carefully.

Shares in Sabeco, with sticker SAB on the Ho Chi Minh Stock Exchange, are the most expensive shares nationwide, being traded at around VND244,000 ($10.48) per share. VNS