By Ian Neubauer
Foster’s announced it will extend the deadline for the review of its wine business by 10 weeks, with the outcome now due in mid-February next year.
The announcement was made at the multi-beverages company’s annual general meeting held today (October 29) at in Melbourne and follows a June decision to write down the value of its poorly performing wine assets by $730 million.
"As previously advised, we expected to complete the wine review by the end of this calendar year,” said Foster’s chairman David Crawford. "However, we have taken the decision to extend our workplan into early next year.”
Crawford acknowledged the global financial crisis but said Foster’s was well placed to weather the storm.
“The alcohol category is typically robust during such periods and our overall business continues to perform well,” he said.
Crawford’s sentiments were echoed by newly appointed CEO, Ian Johnston, who said all businesses are currently dealing with similar issues and Foster’s would not be distracted by marketplace noise.
“In times like this, it is all the more important that we are focused on making changes to get the basic right — focusing on volume growth, gaining value shares, reducing business costs and building our organisational capabilities,” he said.
Johnston said the June writedown had resulted in an 88 per cent profit downturn compared to the previous year, but performance in the first quarter of the 2008-09 financial year was in line with expectations.
The company delivered a net profit after tax of $111.7 million in the 2007-08 financial year, and earnings per share of 5.8 cents.
Foster’s shares were trading at $5.43 at 2:00pm today compared to $5.29 this time last week.
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