Kirin Holdings has cut its full-year profits forecast by 74% due to impairment charges.
Kirin said earlier this week that it expects consolidated net profits for the 12 months to the end of December to be JPY7bn (US$91.7m). That would mean a 38% drop on profits for 2010 and also represents a 74% cut to the Japanese brewer’s previous forecast for 2011.
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One-off charges are the main reason for the group’s u-turn on projected profits. It said that it expects to report around JPY10bn in impairment charges on fixed assets, including JPY6.6bn charge on its Australia business, as well as JPY1.8bn of lost value in investment securities.
Kirin’s share price fell by almost 2% on the Tokyo Stock Exchange on Monday, following the announcement. In contrast to net profits, the brewer’s net sales for 2011 are set to be only 1.8% lower than originally forecast, at JPY2.07tn.
If correct, that would be a 2% drop on sales in 2010. Operating profits, meanwhile, are set to be 0.7% lower than previously expected and 2.8% below 2010 levels, at JPY143bn.
Kirin will release it’s full-year results on 10 February.
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