Japan's second-largest beermaker, Kirin Brewery Corp, said on July 29 it had registered a rise of 12 % of its operating profit to 38 billion yen ($318 million) in the six months to June due to cost-cutting. A spokesman for Kirin said to Reuters the figures were not yet finalised but that cost-cutting had helped the company to beat its earlier projection of 36 billion yen.

But he said weak sales may dent profits in the second half, keeping Kirin from reaching its group operating target of 100 billion yen for the full year to December. "Even if you cut costs, there is a limit," he said. "In the worst case, we might see operating profit fall by as much as 10 percent."

The company is scheduled to announce half-year earnings results on August 8. In May, Kirin projected a group net profit of 39 billion yen on revenue of 1.67 trillion yen for the business year to December. Japanese beermakers have diversified their product lineup, including offering low-malt "happoshu", which is cheaper than normal beer, but have suffered from poor domestic beer demand and sizzling competition in a market which features a growing selection of wines and cocktails.

Shares of Kirin fell 2.09 % to 797 yen in early trade on Tuesday, while the key Nikkei average was up 0.37 %.

30 July, 2003