UK: S&N misses football, but set fair for FY 2007
Poor weather and the lack of football has hit Scottish & Newcastle's first half in the UK, but the brewer still expects to hit full-year expectations across the group.
S&N said today (3 July) that the UK beer market slipped by 5% in the first six months of this year, as inclement weather and last year's football World Cup took their toll. Cider sales in the country grew, meanwhile, leading to the company "investing heavily" in the sector in the first half. The brewer also said that it expects beer volumes in the second half to remain level, despite the potential impact of the smoking ban in the country.
Operating profit in the UK will be lower in the first half compared with the previous year, S&N warned. "However, we believe that performance for the full year in our UK business will meet expectations."
Looking internationally, the company saw Sagres in Portugal and Newcastle Brown Ale in the US act as the top performers. In India, S&N's Kingfisher brands performed "strongly". In France, trading in the wholesale business remains "extremely challenging", the company warned. "This remains a key management priority," S&N said.
Turning to S&N's Eastern European joint venture with Carlsberg, Baltic Beverages Holding, the company credited an unseasonably mild winter, but warned that, in the second half of 2007, "the comparatives get much tougher following the growth of 14% in the market from July to December last year".
The company added: "While in some markets there are particular challenges, we remain confident that performance for the full year will meet expectations for the group as a whole."
Scottish & Newcastle will issue its interim results on 7 August.
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