By Ian Neubauer

Lion Nathan yesterday (Feb 19) announced it has grown net sales revenue by 7 per cent for the quarter ending Dec 31, attributing gains to a 9 per cent increase in the volume of beer sold compared to the same period in 2007.

But the company fared less favourable with wine, reporting a 10 per cent downturn in net sales revenue. It attributed the result to decline in demand for fine wines in the US and UK, adding that extreme heat and fires in Victoria and South Australia would also impact upon the valuation of its wine assets. 

But unlike rival Foster’s Group, which is writing off hundreds of millions from the value of overvalued wine assets, Lion Nathan’s wine business represents a measly 3 per cent of its earnings and as such is not material the company’s full year outlook.

Lion Nathan CEO Rob Murray said the company’s balance sheet remained strong despite $3m in banking fees associated with its failed takeover bid of Coca-Cola Amatil, and that the company was on track to produce a net profit of at least $300m for the current financial year.

“Our business is in robust shape thanks to the investments that we have made in recent years to drive growth,” he said. “The beer market is resilient and our largest business units continue to deliver high quality results. We are on track to deliver earnings growth of between 10 and 16 per cent.”

Lion Nathan shares were trading at $8.78 at midday today (Feb 20) compared to $8.61 seven days ago.

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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