August 16 – Wuliangye Yibin (000858) recorded a 48.72-percent increase in interim net profits to 3.36 billion yuan, reports yicai.com, citing a company filing. Sales revenues grew 39.84 percent to 10.6 billion yuan while operating profits hit 4.6 billion yuan, up 49.03 percent. All percentage changes cited in this article are year-on-year.

Sales volume of the Wuliangye Series increased 30.5 percent from the same period a year ago with output insufficient to meet its needs.

According to Yu Hong, analyst at Datong Securities, Wuliangye will probably raise prices once before the end of the year in light of rising labor costs.

Shanxi Xinghuacun Fen Wine Factory (600809), another distillery, generated interim net profits of 659 million yuan, an increase of 97.21 percent. Fen Wine earned revenues of 2.89 billion yuan, up 79.89 percent while operating profits rose 92.1 percent to 1.04 billion yuan.

At end of March, Fen Wine raised the price of its 30-year Qinghua series by 20 percent and jacked up the prices of its other series by 10 percent.

Qiao Yang, analyst at Changjiang Securities, pointed out that domestic alcohol sales saw double-digit growth in April and May, which is the industry’s low season.

In addition, distillery makers are able to pass the ever-rising costs from labor and raw materials to consumers.

Source:CapitalVue