Kingway Brewery has posted a net loss for 2007, reversing the net profit delivered in the year before.

The Chinese brewer said today (21 April) that net loss for 2007 totalled HKD23.6m (US$3m), compared to a net profit in 2006 of HKD110m. Sales in the period rose, however, to HKD1.58bn from HKD1.41bn.

Late last year, Kingway warned that net profit for 2007 "may experience a significant decline" on 2006 and "may even record an operating loss for the full year", due to rising raw material and expansion costs. The company has suffered not only as a result of the increase in malt prices, but also from having to cut the retail prices of its beers due to a shift of product mix this year.

Kingway said it would not pay a dividend for 2007, although the company did pay HKD0.015 per share in 2006.

Heineken holds an indirect 21.44% interest in Kingway through Heineken-APB (China), a joint venture between Asia Pacific Investment (API) and Asia Pacific Breweries. API is a holding company jointly-owned by the Dutch brewing giant and Singapore-based conglomerate Fraser and Neave.