Russia. Tinkov goes down from Olympus

A businessman Oleg Tinkov created one of the most successful Russian brand in the expensive segment of the beer market will try to earn on cheaper beer and start to produce a new sort "T". Brewers doubt in success of this undertaking as the company Tinkoff will compete with very strong brands in a new market.

The brewing company "Tinkoff" includes a network of restaurants of the same name and a brewery in Sent-Petersburg with the capacity of 2,5 million decalitres per year. Last year the company produced 1,7 million decalitres of beer "Tinkoff", the total turnover amounted to $53 million. According to "Business Analytika" in September - October, 2004 the beer market share of "inkoff" made about 0,9% in value terms.

The new beer "T" would enter the market in spring, Oleg Tinkov told. A sales manager of the company "Tinkoff" Michail Adamov specified that a retail price of the new beer would make presumably 19-20 roubles for a half-liter bottle. Tinkov expects that "T" will compete with Miller, Tuborg and Holsten at a 20% lower price.

In 2005 the businessman plans to produce about 3 million decalitres of the beer "T" and as much "Tinkoff". This year the brewery is going to invest in promotion of its brands no more than $10 million, but the main part of this money will be spent on launch of "T", Tinkov says. Thus it is sure in the company that launch of the new brand will not worsen positions of the trade mark "Tinkoff". The beer "" will be used by students and when they grow up and start to work, will change to "Tinkoff," the businessman hopes.

In April Tinkov expects to start a new plant in Pushkin with the capacity of 20 million decalitres of beer per year on which it is planned to begin production of "T". He hopes to produce license beer or orders from the foreign brewing companies on the rest of capacities.

A marketing manager of the Sent-Petersburg brewery "Vena" (uborg, "Nevskoe") Dmitry Shirshov doubts whether this year "Tinkoff" can sell more than 1 million decalitres of the beer "T". As he said a "local premium" segment was too close and last year it had grown only on 8% while all market had grown on 11%.

Shirshov estimates minimal investments into launch of the new trade mark in $10 million. "This money will be wasted, I would advise to invest it in more successful brand "Tinkoff," the expert in marketing considers. "The market capacity will not allow to sell so much "T", there are more strong brands in the market, and it will be difficult to press them," a general director of the distribution company "Linkor" Andrey Galanin echos.

An analyst of the United Financial Group Alexey Krivoshapko on the contrary is sure in realness of plans of "Tinkoff". By estimations of UFG last year the "local premium" segment grew on 18%, and in 2005 expected growth is 8% up to 210 million decalitres. According UFG this year growth of all beer market will amount to 4%.

Vedomosti

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Russia. Results of activity of JSC "Tomskoe pivo" in 2004

2004 is called by JSC "Tomskoe pivo" as the most successful year for all 120-years history of the enterprise. Production volume made 8 million decalitres of beer that is almost in 3 times more than a last year parameter and amounts to 1% of the Russian beer market.

Growth rate of sales of "Tomskoe pivo" exceeded growth rate of the Russian beer market almost in 16 times, and "Tomskoe pivo" is the absolute leader in the branch by this parameter.

There are a lot of reasons of such progressing growth, these are a modernisation of the enterprise, and as consequence achievement of a high level of quality of production, and effective work of a sales structure in all covered regions, and a successful marketing strategy etc.

Plans for 2005 includes a construction of an additional dispensing shop, increase of warehousing areas, putting a new waterwork into operation. It will allow the enterprise to increase the maximal level of production up to 1 million 200 thousand decalitres of beer per month and sales up to 10 million decalitres of beer per year.

The press-service of the Union of Russian Brewers

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Ukraine. Some results of Baltic Beverages Holding in Ukraine

The best parameters of beer production in Ukraine in 2004 are shown by SUN Interbrew. Baltic Beverages Holding is on the second place. Baltic Beverages Holding invested as a whole more than $150 million in a reconstruction of capacities of JSC "Slavutich" Beer and Soft Drinks Plant" and "Lvov Brewery" which are part of this company.

In 2004 sales volume of in Ukraine increased by 18%.

Beer of Ukraine

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Russia. Russian beer market has grown contrary to forecasts

Contrary to all forecasts the Russian beer market grew according to different estimations on 9-12% last year. But not all succeeded to earn on growth of beer consumption: two largest companies "Baltika" and SUN Interbrew skimmed the cream off the market. Analytics and participants of the market consider that it will not be possible to repeat last year's growth of the branch any more because the antibeer legislation puts in force.

According to preliminary data of Rosstat published this week last year Russian producers produced 842 million decalitres of beer, it is 11,5% more than in 2003. The Union of the Russian Brewers and the marketing agency "Business Analytika" cite similar data in the joint report. According their data last year 851,96 million decalitres of beer were made in Russia that is 12,5 % more than year before. A little bit smaller figure 9,2% is cited by the United Financial Group.


These parameters have surpassed expectations of brewers and branch experts: in the beginning of the last year they supposed that the market would grow only on 5-7% in natural terms.

Though since the end of 90th the beer market has increased in volume, its growth rates has continuously reduced from 33% in 1999 up to 7,8% in 2003, an executive director of the Union of Russian Brewers Vyacheslav Mamontov reminds. The last year was record for branch by this parameter, the head of the branch union says.

By estimation of Mamontov the Russian beer market in 2004 overcame a level of $7 billion in money terms, year before its volume made $6-6,5 billion.

By the estimation of an analyst of "UralSib" Marat Ibragimov in 2004 "Baltika" increased sales by 23%, SUN Interbrew - by 22,3%. An analyst of the United Financial Group Alexey Krivoshapko reminds that 2003 was unsuccessful for the brewing branch because of cold spring and a failure of sales of "Baltika" connected with reorganization of a distribution system.

A chief of a marketing department of the company "Tomskoe pivo" Maxim Krohtin says, "The way of life changes, and consumers in increasing frequency choose beer as alternative to strong alcoholic drinks". "The market of cheap alcohol stagnates during three years, and producers had an opportunity to win new consumers with the help of aggressive advertising," a head of a department of alcoholic production of the Omsk company "Group "Osha" Alexander Khitrin agrees.

In fall legislators limited advertising of beer strongly and it will necessarily adversely affect parameters of the market this year, brewers note.

Legislative restrictions of beer advertising put in force last fall have not strongly affected a mid-annual parameter of production, but participants of the market sure that this legislation will necessarily affect this year. The Union of Russian Brewers predicts growth of the beer market of 5-7% in 2005, the same figure was given by Tihonov from SABMiller, and Rukavishnikov from "Baltika" forecasts 4%. Krivoshapko from UFG expects 4% this year, and Ibragimov from "UralSib" expects 5%.

A vice-president of SUN Interbrew Irina Kibina named data of Goskomstat for the last year as average. Under her data in November - December beer sales did not already practically increase in relation to the same months of 2003 because of force of antibeer laws, and production of local producers appreciably reduced, Kibina notes. "About half-year people will continue to buy as much beer mechanically, but later laws will have an effect," Tihonov from SAB Miller is sure.

Vedomosti

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Russia. Brewery "Patra" is prepared for sale again

According to last agreements between SUN Interbrew Ltd. and "Alpha-E" the control over the Ekaterinburg brewing company "Patra" completely passes to "Alfa-Eko". In opinion of analysts it means that sooner or later the Ural beer will be sold.
In the first quarter of 2005 the Belgian company InBev plans to finish buying up shares of SUN Interbrew from the Russian company Eco Holdings Ltd. ("Alpha-E") and Indian SUN Trade (International) Ltd. As a result of these transactions InBev will accumulate 98,5% of the authorized capital of the company and thus will close a question about proprietors of SUN Interbrew. After their end SUN Trade and companies affilated with it will own approximately 2% of shares of the increased authorized capital of InBev.

Within the framework of these processes the agreement has been reached that the share of SUN Interbrew in Joint-Stock Company "Ekaterinburg Brewing Company" and also the share of SUN Trade in the company "Damsel Limited" (and indirectly 23,82% of shares of JSC "Patra" belonging to Damsel Ltd.) pass to "Alpha-E". If it is remembered that in summer "Alpha - E" bought 50,56% of shares of JSC "Patra" belonging to Joint-Stock Company "Brewing Concern "Patra", now it has about 75% of shares. Last October the rest 25,5% were sold by the state on public tenders to the company Redcove Invest LTD for 116210 thousand roubles. In May Redcove sold 17% of this share holding to the offshore company Ramantia Investments Ltd, in a result they own 8,5% of shares of JSC "Patra". As experts asserted earlier these companies were connected either with portfolio investors or with the former management of the company.

In opinion of an analyst of "ATON" Alexey Jazykova the further destiny of "Patra" will be connected with resale.

Practically all large international brewing companies can act as potential buyers. Not so long ago the corporation SABMiller declared intentions to make some purchases in Russia (now it owns the Kaluga brewing company produced such trade marks as Miller, Pilsner Urquell, Velkopopovicky Kozel, Redd"s). Last year the Dutch company "Heineken" declared its interest to the Ural region. The Dutchs considered an opportunity of purchase of beer actives on Ural. However as a PR-manager of "Brewery" Heineken" Anna Meleshina informed UralPolit.Ru, for today that question was not solved. "But the company has not lost interest to the Ural region and all offers are interesting for us," she noted.

In opinion of experts only SUN Interbrew can be interested in purchase of "Patra". Now it is one of the largest brewing companies in Russia and in Ukraine which produces such trade marks of beer as "Stella Artois", "Bek's", "Staropramen", "Klinskoe", "Sibirskaya Korona" and "Tolstyak". In due time the company could not include "Patra" in its structure however now it could buy it out.

UralPolit. Ru