Healthy froth on DB profits

By SIMON HENDERY liquor writer

A slimmed-down DB Group, which last year shed its wine and liquor distribution operations, says it has increased sales by focusing on its core brewing business.

DB, 76 per cent owned by Asia Pacific Breweries in Singapore, yesterday reported a net profit for the year to September 30 of $58.3 million, up from $23 million the previous year.

The result includes a $34.7 million gain from the sale of Corbans Wines, which Montana picked up in September last year.

Annual revenue was $278.3 million, compared with $530.17 million the previous year.

During the previous financial year the company sold Allied Liquor Merchants and NZ Liquor.

DB Group now comprises DB Breweries and the franchised Liquorland chain.

Group managing director Brian Blake said DB Breweries' sales were up slightly from $276.2 million last year - a pleasing result because the America's Cup regatta, millennium celebrations and the introduction of beer sales in supermarkets had contributed to the previous year's strong outcome.

Mr Blake said DB had continued to build key brands, including Heineken and Monteith's, which were part of the growing "premium" brand market.

Monteith's sales had grown 20 per cent over the year and the company was testing the market for the product in Singapore.

Progress on the company's $60 million redevelopment of its Waitemata brewery site in Otahuhu, involving a packaging hall and an administration building, was progressing well, Mr Blake said.

All DB's Auckland staff will move to the revamped complex from the company's three city sites. The project is scheduled to be completed by next August.

Mr Blake said inflation-related cost increases and the lower value of the New Zealand dollar had eaten into margins and operating costs during the year.

DB will pay a dividend of 15.5c a share on November 28, taking its full year dividend payout to 27c a share.

Asia Pacific Breweries Singapore-based regional director, Eric Nelissen, said the company was not planning to increase its stake in DB.

APB is a joint venture between Dutch brewer Heineken and Singapore's Fraser & Neave.

DB shares were untraded yesterday but last changed hands for $5.35.