E-Malt.com News article: 1394

Asahi Breweries Ltd, Japan's largest beer maker, said on August 5 that it was likely to fall short of its profit forecast for the first half due to poor sales, Reuters reported. "Along with other beer makers we are suffering from weaker-than-expected sales of both regular and low-malt beer," an Asahi spokesman said. He said the company was likely to report lower-than-forecast pretax profit and sales for the half-year when it announces earnings on Thursday.

But the spokesman declined to confirm a report in the Nihon Keizai daily that Asahi would post a group pre-tax profit of 18.5 billion yen ($153.8 million) for the six months ended June 30. That would be 1.5 billion yen short of Asahi's February forecast of 20 billion yen.

Japanese beer makers have been diversifying their product lines, offering low-malt "happoshu", which is cheaper than normal beer, but have suffered from poor domestic beer demand and rising promotional costs amid fierce competition.

Asahi's first-half sales rose 1% to 640 billion yen but were 42 billion yen lower than forecast, mainly due to a total six percent fall in sales of regular and low-malt beer, the paper said.

An unseasonably cool summer and other factors are certain to depress sales in the fiscal second half and push full-year results below forecast, the Nihon Keizai said.

Asahi is not the only beer maker suffering from poor sales. Rival Sapporo Holdings Ltd last week slashed its profit targets for the first half, while Kirin Brewery Co Ltd has said that it may miss its group operating profit target of 100 billion yen for the full year to December.

Asahi shares were down 2.02 % at 678 yen as of 0045 GMT, underperforming a 0.68 % fall in the Nikkei average. The shares are down around 10 % so far this year, underperforming a 1.54 % rise in the food sector subindex over the same period.


05 August, 2003