Chongqing Brewery to settle dispute, set to boost 2025 profit

Chongqing Brewery will hold its third extraordinary general meeting of shareholders on December 31, 2025, to approve a mediation agreement with Chongqing Jiawei Beer Co., Ltd. This agreement aims to resolve contract disputes stemming from a strategic cooperation agreement signed in 2007. Under the proposed settlement, Chongqing Brewery or its subsidiaries will make a one-time payment of 100 million yuan (excluding tax) to Jiawei Beer for volume-price difference settlement up to December 31, 2025.

The mediation also outlines future cooperation from January 1, 2026, to December 31, 2028, with Chongqing Brewery committing to procure a fixed 142,600 kiloliters of beer annually from Jiawei Beer at an average procurement price of 4,000 yuan per kiloliter (excluding value-added tax). The existing agreements and memorandums between the parties will terminate on December 31, 2028.

Financially, the proposed accounting treatment is expected to increase Chongqing Brewery’s 2025 total profit by 37.1055 million yuan and net profit attributable to shareholders by 19.0796 million yuan. This is primarily due to the reversal of an estimated liability of 254.0292 million yuan previously recognized from a first-instance judgment, partially offset by a new liability of 216.9237 million yuan for the one-time volume-price difference settlement.