By Nick Stride
Friday 14th May 2004 |
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Responding to market "speculation" Lion confirmed on Tuesday that it was talking to Heineken, DB's controlling shareholder, about forming a venture to make and distribute premium beer brands in the Australian market.
Analysts said such a venture would affect DB, which exports Heineken keg beer to Australia, but they said the impact on DB's earnings was unlikely to be significant.
DB this week announced a 2% higher $17.2 million March first half profit and said it would raise prices to help it achieve its target of a 10% lift in full year ebit (earnings before interest and tax). First half ebit were up 14.2% at $26.8 million.
Chief executive Brian Blake said the company's net sales were up 7.2%, to $183.7 million.
Both Lion and DB will hike tap prices by 3% and bottle and can prices by 6.5% from June 1, the day a 1.55% excise tax rise comes into effect.
DB cited "rising costs and pricing pressures."
Meanwhile Lion sold its 41 non-gaming hotels (pubs) in Victoria to a British businessman, Michael Thiele, and Australian businessman Adam Clark. It will take a $A34 million ($39.1 million) one-off hit, or 7.4c a share. The sale price was not disclosed but is estimated to be about $16 million.
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