Chinese liquor maker's net profit jumps 61%

Wuliangye Yibin Co Ltd, one of China's top liquor brands, announced Monday that its 2012 net profit surged 61.35 percent year-on-year to 9.94 billion yuan ($1.6 billion). [Geng Guoqing / Asianewsphoto]

BEIJING - Wuliangye Yibin Co Ltd, one of China's top liquor brands, announced Monday that its 2012 net profit surged 61.35 percent year-on-year to 9.94 billion yuan ($1.6 billion).

However, the alcohol drinks maker warned in its annual report to the Shenzhen Stock Exchange that such rapid growth might not be repeated this year due to "changes in macro policy and economic environment", predicting a "slowdown" in revenue.

In December, the Chinese government launched a national campaign prohibiting officials and military officers from extravagance.

Many analysts fear the frugality push will have a sizeable impact on liquor makers, which have been relying heavily on government receptions and business banquets for revenues.

Business revenues of Wuliangye rose 33.66 percent to 27.2 billion yuan, said the liquor distiller, which is based in the city of Yibin of southwestern Sichuan province.

The board proposed a pre-tax cash dividend of 8 yuan for every 10 shares, which could cost the firm 3.04 billion yuan. The proposal is still subject to the approval of shareholders.

The producer said in its annual report that it booked a combined gain of 772,066 yuan in equity investment, with an investment profit of 1.95 million yuan in China Merchants Bank, a 1.11 million yuan loss in China Unicom shares and a 54,000 yuan loss in China Cosco shares.

In February, China's top price regulator - the National Development and Reform Commission - ordered Wuliangye to pay 202 million yuan in fines for price-fixing, while Kweichow Moutai Co, the biggest spirits producer by market value, was also penalized for 247 million yuan.

Moutai's net profit increased 51.86 percent year-on-year to 13.31 billion yuan last year.

The share price of Wuliangye dropped 1.84 percent to 21.93 yuan in Shenzhen on Monday.