JAPAN: Kirin Holdings cuts FY guidance on H1 slip
- Brewer cuts forecasts as Forex hits H1 profits
- Japanese beer business below expectations
- Lion Nathan, innovation boost alcoholic drinks sales
Kirin Holdings reports tough half-year
Kirin Holdings has cut its full-year sales and profits guidance after the brewer reported slips in the first half of 2010.
Kirin said today (16 August) that net sales for the six months to the end of June fell by 5% on the same period of 2009, to JPY1.01trn (US$11.7bn). Foreign exchange losses halved net profits from last year, to JPY7bn, although the firm reported a strong lift in operating profits, up by nearly 50% to JPY59.8bn.
The Japan-based brewer chopped its full-year earnings guidance following the results.
Net profits for 2010 are expected to come in at JPY35bn, 27% lower than previously forecast. Net sales for the year are set to be 2% lower than originally expected and are set to reach JPY2.18tn.
Kirin blamed the majority of its sales decline in the first half of the year on a change in the reporting schedule of its National Foods business in Australia.
Alcoholic drinks sales rose by 3% in the second quarter, to JYP514bn, driven predominantly by Australia's Lion Nathan. The firm was also boosted by the launch of an alcohol-free beer, Kirin Free, which helped to offset the ongoing decline in Japan's core beer market.
However, the group said of its Kirin Brewery business: "Planned H1 sales outcomes were not achieved, and the future of the market continues to be uncertain". Its statement again underlines the importance of overseas expansion for Japan's major drinks firms.
Kirin faced a tough second quarter in its soft drinks and foods division, with sales down 22% on the same quarter of 2009, to JPY275bn. Aside from the change in reporting period of National Foods, the firm added that "dairy and juice markets remained challenging" in Oceania due to macroeconomic weakness in the region.
In July, Kirin announced that it had agreed to acquire nearly 15% of Fraser & Neave for JPY84.6bn (US$967.8m).
The US arm of Lion Nathan has acquired California's Sonoma-based MacRostie Winery and Vineyards for an undisclosed sum....
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