KUALA LUMPUR (Oct 31): Higher volume sales ahead of the reintroduction of the Sales and Services Tax (SST) boosted Heineken Malaysia Bhd’s net profit by a fifth to RM78.9 million in the third-quarter ended Sept 30, compared with RM65.9 million a year earlier.

Earnings per share rose to 26.11 sen from 21.8 sen, the brewer said in a bourse filling.

Revenue was 3.3% higher at RM512 million from RM495.5 million previously, mainly owing to an increase in sales volume ahead of the implementation of the SST in Sept.

For the cumulative nine-months, Heineken Malaysia’s net profit grew 3.5% to RM182.5 million from RM176.4 million a year ago, on the back of a 6.5% improvement in revenue to RM1.4 billion.

“Our performance in the third quarter of 2018 reflects improved consumer sentiment in the market. The reintroduction of SST and subsequent price adjustment resulted in higher sales volume ahead of 17 September 2018,” Heineken Malaysia managing director Roland Bala said in a separate statement. “In the nine-month period, we steadily improved our performance through effective execution of commercial strategies, supported by a sharper focus on cost management initiatives within the Group.”

Looking ahead, Heineken Malaysia expects the business environment to remain challenging given the intense competition, the implementation of SST on September 1, and the continued presence of contraband beer in the market.

“We commend the extensive efforts of the Government and its agencies, in particular, the Royal Malaysian Customs Department, for stepping up enforcement against contraband alcohol and illicit trade, which represent a significant loss of revenue to both Government and Industry. We urge no increase in excise duties on beer to ensure the price gap between duty-paid products and contraband is not widened further,” said Roland.

The Group said it will continue to strengthen its commercial strategies and execution to drive performance with a focus on improving operational efficiencies across the business to achieve a commendable performance for financial year 2018.

Heineken Malaysia closed unchanged at RM18, valuing the company at RM5.44 billion.