ThaiBev, the Thailand-based drinks group, has reported beer sales down by a third in the first quarter of 2009 due to the effects of a global economic downturn on its domestic market.

Total net sales for the group for the first three months of 2009 fell 1.4% to THB27.6bn (US$805.7m), ThaiBev said today (18 May).

Beer sales plunged by 33%, to THB7.9bn, compared to the same quarter last year, said the firm, which owns the Chang beer brand.

"ThaiBev's beer business has suffered a downturn for several months as the company has seen an economic recession occur simultaneously with a restructure of its distribution network," the group said.

"Beer is usually consumed in hospitality and entertainment venues and the economy has had a deep impact on people's discretionary income, so that they no longer go out as much as in the past."

Cuts to advertising and marketing budgets could not prevent the beer business reporting a loss of THB161m for the first quarter, ThaiBev said.

Total group net profits rose by 10% for the period, to THB3bn, as the acquisition of Oishi last September led to a near tripling of earnings in the firm's non-alcoholic beverages business. Net income also rose by 60% in its spirits business.

ThaiBev president and CEO, Thapana Sirivadhanabhakdi, said: "While the results are satisfying this quarter, we are still concerned by the recent economic downturn and will be seeking to stabilise our bottom line over the course of the year.

"We will grow our non-alcoholic beverage and food businesses to keep up with consumer demand and a trend towards health drinks and other soft drinks in future."

ThaiBev announced late last week that it intends to buy Chinese spirits maker Yunnan Yulinquan Liquor Co for RMB69m (US$10m).