SUBANG JAYA (Aug 12): Heineken Malaysia Bhd has planned a capital expenditure of about RM140 million in 2022, according to its managing director Roland Bala.
"We continue to expand our brewery based on future demand that we forecast. This year, we are spending something to the tune of RM140 million on expansion and upgrade of our brewery," Roland told a media briefing after the release of the group's financial results for the first half ended June 30, 2022.
He said the ongoing expansion of its brewery, which started last year, will continue into 2023 but probably "take a breather in 2024".
"As part of our expansion project, we are going to instal solar PV (photovoltaic) panels on all our roofs and that will help to generate renewable energy.
"We have subscribed to the Malaysian Renewable Energy Certificate by Tenaga Nasional Bhd since March 2022," Roland said, adding that the company's carbon emissions in 1H22 dropped 19% from its 2018 baseline.
The company estimated that 75% of its electricity consumption in 2022 will be from renewable sources.
Contraband alcohol sales grew an estimated 5% during pandemic
Sales of contraband alcohol shot up by an estimated 5% due to the low availability of legal alcoholic products during the Covid-19 pandemic, said Heineken Malaysia.
This was also driven by the easy availability of illicit alcoholic products online, according to Heineken Malaysia's corporate affairs and legal director Renuka Indrarajah.
When asked whether the group expects the government to hike alcohol excise duty in the upcoming Budget 2023, she said Heineken Malaysia is actively engaging with the government to explain the correlation between high excise duty and high level of contraband.
"Fortunately, they (the government) heard us, and they are taking a lot of steps to improve the situation. The government has set up a multi-agency task force and is working hard on the issue.
"So they do realise there is a direct correlation. We hope the government makes a change to the excise rate, which is one of the highest in the world. As a result of that, we are losing more than a billion in tax revenue every year due to the contraband," she said.
Currently, Malaysia's alcohol excise duty is at RM175 per litre of alcohol by volume.
On Friday (Aug 12), Heineken Malaysia's share price was two sen or 0.08% higher at RM24.40, valuing the group at RM7.37 billion.