NEWS
BULLETIN
Thursday, May 11, 2000
CBR Brewing Company, Inc. Reports
First Quarter 2000 Operating Results
HONG KONG, May 11, 2000
/PRNewswire via COMTEX/ -- CBR Brewing Company, Inc. (OTC Bulletin Board:
CBRB) (the "Company") announced its results of operations for the three
months ended March 31, 2000, reporting net sales of $35,780,582 and net
income of $572,866, as compared to net sales of $33,688,259 and net income
of $902,389 for the three months ended March 31, 1999. Net income per
common share (basic and diluted) was $0.07 in 2000 as compared to $0.11
in 1999. Weighted average common shares outstanding (basic and diluted)
were 8,010,013 in 2000 and 1999.
During the three months
ended March 31, 2000 and 1999, the Company sold 58,394 metric tons and
52,563 metric tons of beer, respectively, an increase of 11.1%. Beer sales
increased in 2000 as compared to 1999 as a result of a weakening in consumer
demand for foreign branded premium beer in China, which contributed to
an increase in the volume of domestic brand beer sold in China. Net income
decreased in 2000 as compared to 1999 primarily as a result of a substantial
increase in selling, advertising and promotional expenses.
CBR Brewing Company,
Inc., through its subsidiaries and affiliates, is engaged in the production,
distribution and marketing of Pabst Blue Ribbon beer in the People's Republic
of China. As of March 31, 2000, the Company owned effective interests
of 60%, 24%, 33% and 9% in four brewing facilities currently producing
Pabst Blue Ribbon beer in the People's Republic of China, all of which
are managed by the Company. The Company produces Pabst Blue Ribbon beer
under a sublicense agreement with Guangdong Blue Ribbon Group Co. Ltd.
("Guangdong Blue Ribbon"), a related company, which expires on November
6, 2003.
Noble China Inc., a
public company listed on the Toronto Stock Exchange, issued a press release
on May 27, 1999 to announce that it had acquired from Pabst Brewing Company
the exclusive rights to brew and distribute Pabst Blue Ribbon beer throughout
China for a period of 30 years from 2003 to 2033. Noble China Inc. has
issued subsequent press releases reiterating this information. Although
the Company to date has been unable to verify whether such a license has
in fact been granted to Noble China Inc., the terms of any such license,
and whether it is subject to any conditions, the Company believes that
some form of a license was granted to Noble China Inc. by Pabst Brewing
Company. Management has consulted with legal counsel regarding the legitimacy
of the purported license and the Company's potential responses. In addition,
management has consulted with Guangdong Blue Ribbon, the owner of the
Pabst Blue Ribbon trademark in China, regarding potential responses, and
has met with representatives of Noble China Inc. in an attempt to explore
a potential settlement.
Management of the Company
has requested that Guangdong Blue Ribbon take appropriate action to protect
its rights and its sub-licensee's rights to utilize the Pabst Blue Ribbon
trademark in China. The Company has been advised that Guangdong Blue Ribbon
is still evaluating the situation and has not yet determined how it will
respond to this matter. Once Guangdong Blue Ribbon has responded, the
Company expects to be in a position to evaluate and revise its future
business plan and strategy accordingly. The Company is currently unable
to predict the effect that this development may have on future operations.
However, if Noble China Inc. has obtained the exclusive right to brew
and distribute Pabst Blue Ribbon beer in China beginning in 2003, the
inability of the Company to obtain a sub-license from Noble China Inc.
on acceptable terms and conditions to allow the Company to continue to
produce and distribute Pabst Blue Ribbon beer in China would have a material
adverse effect on the Company's future results of operations, financial
position and cash flows.
For further information,
contact investor relations at (818) 789-0488.
|
