KUALA LUMPUR (Feb 27): Heineken Malaysia Bhd will strive to minimise any increases in the retail prices of its products this year as the ringgit weakens, as the group is wary that it could impact sales, according to managing director Roland Bala.

“The last time we did a price increase was in August 2022. While a lot of things are stabilising, we also have devaluation of our currency as well. There are quite a lot of other cost movements here and there but we continue to absorb [them],” he told a media briefing after the group announced its FY2023 financial results.

The group closed its FY2023 with a 6.3% dip in annual net profit to RM386.8 million from RM412.82 million in FY2022, as revenue fell 7.61% to RM2.64 billion from RM2.86 billion.

Net profit for its fourth quarter of September to December last year slipped 5.32% to RM99.07 million from RM104.63 million in the previous year's corresponding quarter, as sales fell as consumer sentiment weakened amid rising cost of living and macro-economic concerns.

Bala also attributed the group's weaker financial performance in FY2023 to market correction due to the high-base effect seen in FY2022, when the group witnessed double-digit growth in earnings following the economys re-opening post-pandemic.

The group also noted that its FY2023 performance was an improvement from its pre-pandemic figures, as annual profit rose 24% from the RM313 million it made in FY2019.

For FY2024, Bala said the group is expecting consumer sentiment to improve after witnessing a strong upswing momentum during the recent Chinese New Year season.

Hence, despite persistent macroeconomic challenges such as the weak ringgit, Bala remains cautiously optimistic about the group's outlook, driven also by the continued tourism recovery in the country.

“Political stability is very important. With a stable government and a lot of new policies following through — and [providing] there isn’t so much disruption in business — that is one of the biggest things [that could drive up the consumer sentiment],” he said.

The group also said its capital expenditure will reduce in the coming years as it has completed most of its projects, so the group will focus on operational efficiency going forward.

At Tuesday’s market close, Heineken Malaysia saw its share price drop 2.1% or 48 sen to RM22.34, giving the group a market capitalisation of RM6.75 billion. The counter has fallen 21.94% over the past year.

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