Revenues declined by 5% due to lower sales volume by 8% which offset the 3% increase in average selling prices. The Company explained that sales volume in the first quarter of 2011 was relatively high due to frontloading in anticipation of the price increase at the end of January 2011, Strong sales of competitor products with low-alcohol content also affected sales output.
Cost of sales was correspondingly lower by 5% due to lower volume that negated the increase in the cost of alcohol by 2%. Gross profit rate remained at 23%.
Operating expenses were lower by 8% as selling expenses went down by 15% while other expense (income) items slightly decreased by 2%.
The Company's public offering last December also paved the way for the Company to increase its current ratio to 8.06 as of March 2012 as against 5.07 in March 2011. The proceeds from the offer are currently being used for the ongoing capital expenditures of the Company's subsidiaries which are expected to be completed within the second half of the year.
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