The Business Herald’s markets and banking reporter.

Revenue drops as NZ consumption falls

DB's profit fell 2 per cent on the previous year to $26.2 million. Photo / Getty Images
DB's profit fell 2 per cent on the previous year to $26.2 million. Photo / Getty Images

Local brewing giant DB Breweries saw its revenue and profit dip last year, but that didn't stop the firm from more than doubling the dividend it paid to its Singaporean parent company.

Otahuhu-based DB, New Zealand's second-biggest brewer after Lion, posted total sales of $465.7 million for the 12 months to September 30, 2012, down from $481.5 million a year earlier, according to its latest set of financial statements lodged with the Companies Office.

DB's profit fell 2 per cent on the previous year to $26.2 million.

The firm paid a dividend of $33.7 million to its owner, Singapore-based Asia Pacific Breweries, up from the $15 million dividend it declared in the previous year.

The brewer's advertising and marketing costs fell to $28 million from $32.9 million a year earlier, while staff costs rose slightly to $55.8 million.

A DB spokeswoman said the company had achieved double-digit growth in earnings before interest and tax over the past three years, despite the decline in revenue, and the drop in profit was the result of increased taxation.

The brewer's divided policy had not changed, but the timing of the dividend payout had, which created a distortion when comparing the two financial years, she said.

DB's rival, Lion, also posted a drop in revenue for the same period, according to its financial statements that were filed in March.

The Auckland-based company's total sales fell to $613.2 million from $635.1 million in 2011, while profit rose to $67.8 million from $52.3 million in the previous year.

Both companies are having to deal with a market in which beer consumption is falling.

The total volume of beer available for consumption in this country dropped 6.6 per cent to 280 million litres in 2012.

And while beer accounted for 81 per cent of total alcoholic beverage consumption in 1996, the proportion had slumped to 61 per cent by last year, according to Statistics New Zealand.

- NZ Herald

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