The weighting of Lion’s portfolio towards mid-strength and other growth segments has assisted it to ride out challenging market conditions, the brewer says.
Lion this month reported that volumes across its total Beer, Spirits & Wine business in both Australia and New Zealand declined 2.5 per cent in the half year ended March 31, largely driven by the timing of the Easter trading period in April 2014 versus March the previous year.
“While the Beer, Spirits & Wine Australia business experienced volume declines as a result of the declining beer market and the timing of the key Easter trading period, improvements in mix secured moderate revenue growth,” the company said.
“Lion’s portfolio is geared to the growth segments of the market, including mid-strength, contemporary, craft and international premium.”
“Australia’s largest beer, XXXX GOLD, continued its long-term growth trajectory, growing 2.8 per cent off a large base, while contemporary brands Hahn Super Dry and mid-strength variant Hahn Super Dry 3.5 outperformed the segment.”
Mid-strength focus
Lion national marketing director Matt Tapper (pictured) told TheShout that XXXX Gold has continually achieved consistent and stable growth in spite of market conditions.
“People’s lives are busier and are filled with additional responsibilities, so great tasting mid-strength options like XXXX Gold have grown in popularity in line with these lifestyle changes,” he said.
Lion recently overhauled the brand and packaging of the XXXX family of beers (pictured above left) and will continue to communicate this to consumers and customers in the leadup to summer, Tapper said.
Also in mid-strength, Tapper said James Squire’s The Constable Copper Ale had been well received as a full-flavoured option in the category.
Siblings James Squire 150 Lashes Pale Ale and The Chancer Golden Ale posted double-digit growth over the half.
Across the entire Lion group, revenue decreased 0.6 per cent to $2.67 billion, with group operating earnings up 1.9 per cent to $420 million, supported by a favourable New Zealand exchange rate.