Frucor Beverages posts dip in profit

Frucor Beverages, whose parent Suntory Beverage & Food debuted on the Tokyo Stock Exchange last week, posted a 31 per cent decline in annual profit as costs rose and sales fell.

The New Zealand bottler of Gatorade, V, Just Juice, h2go and Pepsi soft drinks reported a profit of $22.6 million in calendar 2012, down from $32.8 million a year earlier. Sales declined 2.3 per cent to $405.8 million.

Frucor's results show it paid dividends of $10.9 million last year, down from $25.4 million in 2011. The value of its brands was unchanged at $13.2 million.

While cost of sales fell 8.9 per cent, increasing gross profit, its selling and distribution expenses jumped 20 per cent to $97 million and financial expenses were $4.6 million, up from just $4000 in 2011. Tax paid declined 28 per cent to $9.4 million.

Frucor made brand royalty payments of $50.9 million in 2012, down from about $55 million in the previous year. It had $13.5 million of contracted capital expenditure, from $2.2 million a year earlier.

The company is in dispute with Inland Revenue over the treatment of its optional convertible notes and at the time of its annual report being published was still awaiting allocation of a High Court hearing after filing papers in the court last year.

Suntory Holdings acquired Frucor in 2009 from France's Danone and the local business is now held within Suntory Beverage & Food, which went public last week after the parent sold down its holding in an initial public offering that raised almost US$4 billion.

It plans to use some of the proceeds to chase acquisitions outside Japan. Japan accounted for 69 per cent of sales and 55 per cent of earnings in fiscal 2012. Oceania made up 3 per cent and 5 per cent respectively last year. BusinessDesk