E-Malt.com News article: 1104

Beer and wine maker Lion Nathan increased its New Zealand earnings by 7.4 % in the past half year thanks in part to last year’s increase in per-capita beer consumption - the first in 25 years. Sydney-based Lion yesterday posted a 10.3 % jump in its net profit for the half year to March 31, to A$110.3 million ($124.3 million). The New Zealand side of the business contributed A$51.7 million to a group operating profit of A$231.9 million. The head of the company’s New Zealand brewing business, Julian Davidson, said it had pumped money from cost savings back into its marketing efforts, which was helping to drive market growth.

In three years the company had increased spending on marketing by 35 %, he said. Strong competition was credited for a 21 % year-on-year increase in supermarket sales, which now account for 25 % of the company"s New Zealand sales.

Premium brands, now making up about 20 % of sales, continue to be the industry"s big growth story. Although sales of some cheaper mainstream Lion brands were falling, sales of the premium Mac"s label was up 26 %, and Stella Artois sales rose 37 %. Lion chief executive Gordon Cairns said the company was on track to meet its full-year profit expectation of A$180 million ($204.63 million), 11 per cent up on last year.


21 May, 2003