NEWS
BULLETIN
Wednesday, Novermber 20, 2002
CBR Brewing Company, Inc. Reports Operating Results for the Three Months and
Nine Months Ended September 30, 2002
HONG KONG, Nov 20, 2002 /PRNewswire-FirstCall via COMTEX/ --
CBR Brewing Company, Inc. (OTC Bulletin Board: CBRB) (the "Company") announced the results of its operations
for the three months ended September 30, 2002, reporting net sales of $15,980,032 and a net loss of $7,163,938,
as compared to net sales of $21,149,346 and net income of $499,293 for the three months ended September 30,
2001. Included in net loss for the three months ended September 30, 2002 was a charge of $3,493,976 for the
impairment of property, plant and equipment. Included in net income for the three months ended September
30, 2001 was a charge of $119,043 for restructuring costs. Net loss per common share (basic and diluted)
was $0.89 in 2002 and net income per common share was $0.06 in 2001. Weighted average common shares were
8,010,013 in 2002 and 2001 (basic and diluted).
For the nine months ended September 30, 2002, the Company
reported net sales of $58,039,204 and a net loss of $19,593,198, as compared to net sales of $69,284,789 and
a net loss of $3,776,514 for the nine months ended September 30, 2001. Included in net loss for the nine months
ended September 30, 2002 was a charge of $8,313,253 for the impairment of property, plant and equipment. Included
in net loss for the nine months ended September 30, 2001 were charges aggregating $3,166,668 for the impairment
of property, plant and equipment, restructuring costs and the write-off of an investment in a subsidiary. Net
loss per common share (basic and diluted) was $2.45 in 2002 and $0.47 in 2001. Weighted average common shares
were 8,010,013 in 2002 and 2001 (basic and diluted).
For the three months and nine months ended September 30, 2002,
the Company's affiliate, Noble Brewery, recorded charges for the impairment of property, plant and equipment
and restructuring costs aggregating $4,447,017 and $13,280,702, respectively.
During the three months ended September 30, 2002 and 2001,
the Company sold 42,133 metric tons and 39,276 metric tons of beer, respectively, an increase of 7.3%. The
increase in beer sales in 2002 as compared to 2001 was attributable in part to an increase in sales of local
brand beers, which are sold at a much lower price than Pabst Blue Ribbon beer products.
During the nine months ended September 30, 2002 and 2001, the
Company sold 122,663 metric tons and 125,105 metric tons of beer, respectively, a decrease of 2.0%. The decrease
in beer sales in 2002 as compared to 2001 was primarily attributable to the lower sales prices of local brand
beers, as well as the lowering of the selling price for some of the Pabst Blue Ribbon beer products in order to
encourage distributors to enhance their respective promotional activities.
The beer market in China has experienced a weakening in consumer
demand for foreign branded premium beers in China and increasing competition from local and foreign premium
brands of beer. In response, the Company has introduced several new local brand beers. The Company expects that
these adverse market pressures will continue during the remainder of 2002, resulting in losses for the
near term.
The Company, through its subsidiaries and affiliates, is engaged
in the production, distribution and marketing of Pabst Blue Ribbon beer in China. As of September 30, 2002, the
Company owned effective interests of 60%, 24% and 33% in three brewing facilities in China producing Pabst Blue
Ribbon beer that are managed by the Company. The Company produces Pabst Blue Ribbon beer under a sub-license
agreement with Guangdong Blue Ribbon Group Co. Ltd., an affiliated company, which expires concurrently with
the expiration of the existing master license agreement between Guangdong Blue Ribbon Group Co. Ltd. and Pabst
Brewing Company on November 6, 2003.
Noble China Inc.:
Noble China Inc. is a Canadian public company that is the 60%
owner of Noble Brewery, a Pabst Blue Ribbon brewing facility in Zhaoqing, China, in which the Company has a 24%
net equity interest. Noble China Inc. has publicly reported that in May 1999 it entered into a license agreement
with Pabst Brewing Company granting it the right to utilize the Pabst Blue Ribbon trademarks in connection with
the production, promotion, distribution and sale of beer in China for 30 years commencing November 7, 2003. Noble
China Inc. has recently publicly reported that it was experiencing severe financial difficulties, was unable to
meet its financial commitments and is insolvent, and is considering various courses
of action.
Management of the Company has met with representatives of Noble
China Inc. in an attempt to explore a potential relationship subsequent to November 6, 2003. Management is
currently unable to predict the effect that these developments may have on future operations, including any
effect on the Company's ability to obtain a sub-license to produce and distribute Pabst Blue Ribbon beer in
China effective from November 7, 2003, or the impact on Noble Brewery, the Company's affiliate. However, the
inability of the Company to obtain a sub-license from Noble China Inc. on acceptable terms and conditions
that would enable 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.
The Company's controlling shareholder, Zhaoqing City Lan Wei
Alcoholic Beverage (Holdings) Limited, a company controlled by the City of Zhaoqing, owns a 19.6% equity
interest in Noble China Inc. On November 12, 2002, Noble China Inc. held a meeting of shareholders to elect
a new Board of Directors to consist of three members; three candidates nominated by Lan Wei Alcoholic
Beverage (Holdings) Limited were elected to the Board of Directors.
Cautionary Statement Pursuant to Safe Harbor Provisions of the Private
Securities Litigation Reform Act of 1995:
This news release contains "forward-looking" statements,
which are made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, among others, statements of expectations, beliefs, future plans and
strategies, anticipated events or trends, and similar expressions concerning matters that are not historical
facts. The forward-looking statements in this news release are subject to risks and uncertainties that could
cause actual results to differ materially from those results expressed in or implied by the statements contained
herein. The Company undertakes no obligations to revise or update any forward-looking statements contained
herein in order to reflect events or circumstances that may arise after the date of this news
release.
For further information,
contact investor relations at (310) 274-5172.
|
