Panmure Gordon has reduced its earning estimates on Scottish & Newcastle. The move follows a report in The Times newspaper, saying that beer sales in France, where S&N's Kronenbourg accounts for around 30% of the brewer's pre-tax earnings, have fallen by 2.5% in the first five months of this year.

"Last year's hot summer means that comparatives for (S&N's) French business are tough and are not helped by a weak consumer environment," the broker said. Panmure Gordon has a 'hold' rating on the brewer's stock.

The broker also lowered its pre-tax earnings forecast for Kronenbourg by £10 m, resulting in a cut to its 2004 earnings per share forecast of £0.08 to £0.30.

Panmure advised its clients to switch into Allied Domecq, which it rates as a 'buy'.