Volumes down, profits up for Foster’s

October 17, 2009 04:49:22 PM

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Foster’s Group Pacific Ltd (FGPL) has announced an after-tax profit of $10.59 million for the 2009 financial year, up 2.9 percent from the previous year’s profit of $10.29 million, despite a decline in sales volumes and revenue due to adverse trading conditions in Fiji and Samoa.

Chairman Stephen Matthews said operating profit before interest and tax increased by 7.5 percent from $14.55 million to $15.64 million.

Matthews said the increase was driven by new product development, price increases as well reduction of overheads across the business, but offset by higher costs of production during the year, caused by the impact of the devaluation of the Fiji dollar in April on imported production items.

Overall consolidated sales volumes declines by 11.7 percent while sales revenue dropped by 2.3 percent, from $66.623 million in 2008 to $65.065 million in 2009.

Fiji Beer sales volumes decreased for the year by 6 percent while spirits and imported wines volumes fell 13.7 percent.

However, sales revenue in Fiji increased by 1.4 percent from $43.3 million to $43.9 million.

“Increased sales revenues were largely driven by pricing movements and a favourable mix towards more premium products,” Matthews said.

Trading conditions in Samoa and American Samoa were also adversely affected.

Declining remittances and the right hand drive conversion in Samoa, and the uncertainty in the American Samoa fish canneries combined with the global economic climate contributing to a significant 24.5 drop in beer volume sales for Samoa Breweries Ltd.

Soft drink sales volumes also fell 11.6 percent.

The company recorded a 1.9 percent drop in after tax profit to SAT$5.2 million in June 2009 from SAT$5.3 million in June 2008.

Matthews said that based on this performance, a final dividend of 15 cents per share was recommended, bringing the annual dividend to 30 cents per share.

The business outlook for 2010 would again be influenced by challenges similar to those faced in 2009, Matthews said, “and will largely depend on how Pacific islands manage their economies as the global economy moves out of recession”.