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China's Tsingtao Brewery estimates 39 pct drop in 2016 profit
March 21, 2017 / 3:01 PM / 8 months ago

China's Tsingtao Brewery estimates 39 pct drop in 2016 profit

March 21 (Reuters) - Tsingtao Brewery Co Ltd, China’s second-largest brewer by volume, estimated its 2016 net profit fell about 39 percent, hurt by stringent market conditions and to account for a supplemental tax payment.

The company said it would pay a difference in income tax of about 339 million yuan ($49 million) that resulted from the application of an expired preferential income tax rate in the years prior to 2007.

Accordingly, the company would have to reduce its net profit attributable to shareholders by that same amount in the year ended Dec. 31, 2016, Tsingtao said.

The group had reported a net profit of 1.71 billion yuan in 2015.

The brewer in August reported its profit fell 10.8 percent to 1.07 billion yuan in the six months through June as slower economic growth and tougher-to-please consumers dragged on growth.

China’s beer market - the world’s largest by volume - is a key battle ground for global beer brands, but turning a profit is tough. ($1 = 6.88 yuan) (Reporting By Anusha Ravindranath in Bengaluru; Editing by Savio D‘Souza)

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