San Miguel Hong Kong Been Sales Up

December 9, 1999 PSE CIRCULAR FOR BROKERS NO. 3142-99 SAN MIGUEL HONG KONG BEEN SALES UP San Miguel Corporation's Hong Kong beer business reported a 17% volume growth for the month of October compared with the previous year, pushing year-to-October volumes up to 6%. The strong showing is attributable to San Miguel Hong Kong's aggressive sales initiatives and its "Take a Fresh Look" marketing campaign which continues to win new consumers. Despite Hong Kong's prevailing deflationary pricing environment, Hong Kong sales revenue improved 5.2% to HK$615 million as of October, while operating income posted a dramatic turnaround from an operating loss of HK$3.8 million to an operating profit of HK$57 million. The performance is a result of a more market-driven product mix and tighter control on fixed expenses. During the same period, fixed costs were reduced by 18%. cdll On a consolidated basis, San Miguel Brewery Hong Kong reported an operating income of HK$94.4 million or a growth rate of 180% including the positive contribution from its two breweries in Southern China. Net income of HK$59.4 million was more than four times that of the previous year's HK$14.6 million. As a result of this strong performance, SMBHK's board of directors approved on December 3, 1999 a third interim cash dividend of HK 3 cents per share totaling HK$11.2 million. So far this brings total dividends declared for the year-to-date to HK 8 cents per share totaling HK$29.9 million. (These figures exclude the 1998 final dividend of HK 2 cents per share paid in April 1999). The improvement in San Miguel's international operations reflect the Company's various brand and volume building initiatives particularly in Hong Kong and China. LexLib San Miguel's consolidated international operations have already been contributing positively to the Group since July 1999. LexLib Stemming losses overseas was one of the key priorities identified by San Miguel Chairman and Chief Executive Officer Eduardo M. Cojuangco, Jr. early last year. llcd