Beer business raked in $65m in first half year

August 27, 2009 07:30:49 AM

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Beer business continued to pay well for Fiji-based and Australian-owned Fosters Group Pacific Ltd, who reported sales revenue of a little over $65 million in the first half on its financial year, ended June 30, 2009. 

The company is listed on Fiji’s South Pacific Stock Exchange and Tuesday filed its un-audited six-monthly financial report, revealing a lucrative alcoholic beverages business in the Pacific markets that it operates in. 

FGPL businesses raked in F$65 million in the first six months alone, and although this was a 2.3 percent drop compared to the same period last year, the company improved on its bottom line, closing its books at F$15.5 million net profit before tax, a 7.8 percent increase from last year’s first half results. 

“This increase was driven by new product development, price increases as well as overall reduction of overheads across the business and offset by higher costs of production during the year,” FGPL director Ross Shaw and company secretary Alfred Chang said in their financial notes.

They added however that the company was trading in a difficult economic climate.

“Trading conditions in Pacific Island markets were very difficult driven by the impact of global economic crisis on Pacific Island economies. The oil price increases in late 2008 applied significant pressure on costs of production. Uncertainty in American Samoan fish canneries also contributed declining beer volumes in Samoa market. As a result, GDP contraction on prior years has been forecasted in both Fiji and Samoa economies,” they said.

“Overall consolidated sales volumes declined by 11.7 percent from 3.961m nine litre cases in 2008 down to 3.498m nine litre cases in 2009. During the year, the company completed installation of new pastueriser and bottlewasher as part of packaging line upgrade.”

The company had posted a net profit of F$7.37 million for the nine months ended March 31, 2009 and had declared a 15-cents-per-share interim dividend, a drop from the 20 cents per share dividend it paid out in the previous 10 months.

FGPL, which operates breweries in Fiji and Samoa, recently experienced a major change in shareholding, when second largest shareholder Fijian Holdings Ltd sold its 29 percent stakes to Australian beverage maker Fosters, increasing the latter’s shares in the company to 89.6 percent.

This was seen by Fosters as a strategic move which it said provided it with greater strategic alignment and flexibility with respect to ongoing investment and management of Foster's Pacific business.

FGPL last traded at $13 on SPSE.