Premium brands bolster Lion Nathan

LION NATHAN, recently swallowed up by the Japanese brewer Kirin, has bid farewell to its shareholders and reported an operating net profit after tax and before one-time items of $313.1 million, up 13 per cent on the previous year. The result does not include the one-time cost of the Kirin takeover and the acquisition of Boag's beer the year before. The company, which is no longer listed, did not release its bottom-line net profit result.

By InvestSMART · 6 Nov 2009

By InvestSMART ·
6 Nov 2009

The result does not include the one-time cost of the Kirin takeover and the acquisition of Boag's beer the year before. The company, which is no longer listed, did not release its bottom-line net profit result.

Group net sales for 2008-09 rose 7.1 per cent to $2.242 billion.

Following its acquisition by Kirin, Lion Nathan has been fused with dairy company National Foods to create a sprawling $7.5 billion food, liquor and beverages giant.

The former chief executive of Lion Nathan and now boss of Lion Nathan National Foods, Rob Murray, said growth accelerated for Lion Nathan during the second half of the financial year. Growth for the half was 22 per cent up on the previous corresponding period. The earnings strength came from its Australian operations, for which operating earnings before interest and tax grew 16 per cent to $515.7 million. Net sales rose 11 per cent and total volumes rose 4.7 per cent against market growth of 4.2 per cent.

Its premium beers continued to perform well. Volumes for Hahn Super Dry grew 40.9 per cent for the year and XXXX Gold by 6.2 per cent.

Mr Murray said premium brands were a theme emerging across all market categories. "Across soft drinks, flavoured milks, you name it, that trend is there."

Mr Murray said Lion Nathan's range performed well in New Zealand despite tough domestic economic conditions. The division generated EBIT growth of 5 per cent to $NZ94.3 million ($74.8 million).

Lion Nathan Wine, which contributes less than 1 per cent of the company's total EBIT, was hit by the volatility and downturn in the wine sector. While total volumes grew 9.7 per cent, EBIT fell to $4 million.