AUSTRALIA: Lion Nathan write down hits profits
Following a review of the carrying value of its wine business and other assets, the board of Lion Nathan said today that it had resolved to write down the value of some of these assets.
The impact of these one off items when added to the A$104.1m post tax gain on the sale of Lion Nathan China and the A$34.2m post tax loss on the sale of Victorian hotels, will be to reduce reported NPAT for the 2004 fiscal year by A$42.6m.
The Board of Lion Nathan also confirms that before significant items, NPAT for 2004 will be slightly above A$200m. After significant items Lion Nathan will, subject to finalising audited accounts, report NPAT of around A$160m for the 2004 fiscal year, it said in a statement.
The full year net significant items charge of A$42.6m comprises a cash gain of A$89.3m and a non-cash charge of A$150.2m.
Commenting on these decisions, Gordon Cairns, CEO, and Rob Murray said: "The 2004 year has been a watershed for Lion Nathan. As well as again delivering an excellent operating performance in the Australian beer business, we have taken some important strategic decisions which position Lion Nathan well for the future. These include the sale of Victorian Hotels and Lion Nathan China.
"We have also determined that it is appropriate to reduce the carrying value of the Australian wine business and its inventory, and to write down certain investments and write off some obsolete beer production assets. We confirm our commitment to continuing the development of our premium wine business where much progress has been made over the last year in building a domestic and international premium wine route to market.
"These initiatives make Lion Nathan a stronger business which will continue to deliver solid growth in earnings and cash flow and excellent returns for shareholders."
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