The Philippine food and beverage giant San Miguel will close its brewery in Hong Kong, China, in September due to high production and operating costs, reported local daily Business World on Wednesday.

San Miguel Brewery Hong Kong Limited plans to stop its brewing operations in the Yuen Long District, said the company secretary, Kenneth Woing, in a letter to the Stock Exchange of Hong Kong, according to the report.

"The group may incur significant one-off restructuring expenses in relation to the proposal which may have material short-term negative impact on the profitability of the group," said Wong. "Nevertheless, the proposal will help streamline the production cost structure of the group with a view to improving the long term profitability."

San Miguel operates one brewery each in Indonesia, Australia, Vietnam and Thailand, and three breweries in China, including the one in Hong Kong.

Revenues of the international operations of the group increased by 8 percent in 2006 to 67.7 million U.S. dollars due to strong results from China operations, said the report.