Scottish & Newcastle has provided further details about its proposed GBP50m (US$97.4m) cost cuts.

The brewer, which today (20 February) posted a 7% rise in revenue and a 10.1% hike in operating profit for 2006, also said it would look to extract GBP50m (US$97.4m) in cost savings from the business over the next three years.

The cuts would be staggered over the period, with GBP10m worth of savings forecast for this year, up to GBP30m expected by 2008 and the GBP50m target being reached by 2009.

The savings will be equally split between the brewer's UK and Western European operations. John Dunsmore, S&N UK's managing director, said the company would look to "operational best practice and support function rationalisation" for the savings.

"One example of where savings could be made is the rationalising of our office space in the UK," Dunsmore said. "That alone would constitute a saving of GBP3.5m a year."

When pressed, however, Dunsmore conceded that job losses were likely. "There will be job cuts," he said. "We have a full consultation process with our workers, however, and they will find out about it before the media does. Our focus will be on consultation first."

He added: "With GBP25m of those savings coming from the UK, the emphasis will be much more on improving best practice than redundancies."

Turning to its full-year figures, S&N today said that branded sales across the group last year rose 8.9%. In the UK, S&N said it increased its market share, but warned that the introduction of a smoking ban in the country this year will hit profits by around GBP10m.

S&N's international division, including operations in Portugal, France and Finland, delivered growth for the company's key brands, although operating profit slid by 1.1% to GBP178m. Sales in France, meanwhile, were hit to the tune of GBP10m following disruption caused by the introduction of a new on-trade sales team.

In Asia, S&N confirmed reports that it will enter Vietnam through a joint venture with the state-owned Vinataba group. Further details were not revealed.

Meanwhile, S&N toasted strong margin growth in India, through its United Breweries joint venture. Moreover, S&N said its Chongqing brewery in China gives the brewer "a strong regional platform for regional growth".

Finally, S&N's joint venture with Carlsberg in Eastern Europe, Baltic Beverages Holding, saw sales leap by 23% year-on-year to GBP724m, while operating profit soared by 42.9% to GBP160m. Last year also saw the completion of BBH's merger of its four Russian businesses.

A final dividend of GBP0.14 per share will be paid on 2 May to shareholders of register on 30 March.