AUSTRALIA: Lion Nathan raises guidance on Q1 rise
Net sales for the six months to the end of March rose by 5.5% to A$1.18bn (US$847m), Lion Nathan said today (24 April). Net profits after tax increased by 7%, to A$178m, compared to the same period last year, while operating profits were up 8% to A$307m.
Lion Nathan, which was yesterday subject to a full takeover offer from Kirin Holdings, said that it now expected full-year net earnings of between $305m and $315m, compared to its previously anticipated wider range of $300m to $315m.
An 11% net sales rise in Lion Nathan's native Australia drove sales growth, said the firm, which owns the XXXX beer brand. Operating profits for Australia rose by 15% to $280m for the period.
"Our core beer markets have remained robust despite the economic circumstances, with premium beer remaining attractive as an affordable luxury," said Lion Nathan CEO Rob Murray.
"We have seen some switching to home consumption in particular regions, but overall the market remains in good health."
Lion Nathan beer volumes in neighbouring New Zealand were flat for the six-month period, against the prior year, although operating profits for the country rose by 3%.
The firm's wine business remains difficult, it said, adding that operating profits for the division fell by 55% to A$3.5m for the half-year.
In its outlook, Lion Nathan said: "The company expects a higher growth rate in the second half due to innovation momentum, Boag's growth accelerating, the timing of Easter and the cycling of the investment period of the prior year where fourth quarter marketing spend and the funding costs relating to the Boag's acquisition had a significant impact on results."
Kirin Holdings owns a 46% stake in Lion Nathan, but has signalled its intention to make the Australian brewer a wholly owned subsidiary.
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