June 26, 2013
Asia Brewery may venture on yogurt, soymilk production
Philippine conglomerate Asia Brewery Inc., the beverage unit of the LT Group Inc., intends to produce dairy products yogurt and soymilk once the level of imports reaches critical volume, and in the process diversifying from its core business of beer manufacturing.
LT Group Inc. president Michael Tan said they are already importing soymilk and a partnership with Grupo Leche Pascual from Spain for pasteurized yogurt.
Tan also said that the company is looking at 50% to 60 % capacity utilization before putting up a plant.
Asked how much the company is allotting to put up a manufacturing plant, Tan said "it's still based on capacity and how aggressive we would want to go overseas."
The dairy factory will likely be in the 320-hectare Cabuyao, Laguna complex which houses Asia Brewery's beer, glass, plastic crate, carton, waste water treatment plants and warehousing and transportation facilities. The facility, if completed, will be used as an export base in the ASEAN region, especially for the yogurt as they have no plans to put up plants in other countries.
In December 2012, Asia Brewery Inc. and Grupo Leche Pascual formed the joint venture AB Pascual Foods to make the Philippines its base of expansion for the rest of Southeast Asia.
In July 2011, the two companies signed a memorandum of agreement in Madrid to market Leche Pascual's yogurt products in the Philippines.
Tan said Grupo Leche Pascual is one of the biggest dairy companies in Spain. The Spanish firm identified the Philippines as "one of the biggest places where they would want to have a base in Southeast Asia."
In its 2012 annual report, LT Group said Asia Brewery partnered with beverage player Green Spot Co. Ltd. of Thailand for marketing ready-to-drink soya, cornering 68 % of the entire category in less than two years.
In the first quarter, LT Group, the investment holding firm of beer and tobacco tycoon Lucio Tan, posted a 53 %-jump in net income to PHP5.8 billion (US$133.18 million) while revenues improved by PHP2.2 billion (US$50.55 million) to PHP17.7 billion (US$406.79 million).
Asia Brewery, however, registered 4.9 % drop in earnings to PHP229 million (US$5.26 million) on the back of the new excise tax law implemented this year.
