Wine Investment Profits Still Increasing This Year
Lion Nathan chief Rob Murray says the brewer is on track for “a significant profit step up” this year, despite continued tough conditions in the wine investment industry.
Lion, which is in the midst of a buyout by Japanese drinks giant Kirin Holdings, said total sales volumes had grown 3 per cent in the nine months to June.
Overall sales revenue was up about 6 per cent. The company — with beer brands including Tooheys, Hahn and XXXX — said the wine division continued to be hit by difficult economic conditions in the third quarter, with sales revenue falling because of consumers opting out of drinking fine wine and the higher cost of promotions.
But Lion said declines in wine were offset by growth in the Australian business, with beer volumes growing 5 per cent on a year-to-date basis.
Lion reaffirmed its full-year profit guidance of between $305 million and $315 million before significant items such as the costs associated with the Kirin scheme.
Last year it booked a net profit of $278.3 million.
That was before costs involved with the acquisition of Tasmanian brewer James Boag’s.
“It is particularly pleasing that we are on track for a significant profit step up in 2009, despite weaker economic conditions, volatile financial markets and an uncertain outlook for many consumers,” Mr Murray said yesterday.
Lion also announced that the New Zealand Overseas Investment Office had given the green light to the buyout by Kirin.
Lion’s independent directors have unanimously backed the scheme, but the offer also needs approval from 75 per cent of its shareholders.
Comments Off