Japanese food and drink group Kirin Holdings today (16 August) lowered its profit target for 2010 on the back of one-off charges from certain subsidiaries and on lower sales.
Kirin, which owns Australia’s Dairy Farmers and National Foods, booked a 52.2% fall in net income to JPY7.16bn (US$83.6m) for the six months to the end of June.
The company said the fall in net income came as it recorded a JPY5.3bn charge for inflated earnings at its Mercian Corp. subsidiary. Kirin also recorded a JPY7.5bn charge for a loss on the liquidation of an overseas subsidiary.
Kirin’s first-half sales dropped 4.7% to JPY1.01trn despite a 3.1% increase in sales from its core alcoholic beverage business.
Sales from Kirin’s soft drinks and foods division fell 21.7% in part because of the company’s decision to change the financial year of Lion Nathan National Foods, the parent company of Dairy Farmers, National Foods and Australasian brewer Lion Nathan.
However, Kirin’s group operating income was up 48.9% at JPY59.83bn. Operating income from Kirin’s soft drink and foods division stood at JPY2.5bn – against an operating loss of JPY9bn a year earlier.
Kirin held firm its forecast for group annual operating income at JPY133bn. However, it now sees annual sales hitting JPY2.18bn, down from an earlier target of JPY2.22bn.
Moreover, Kirin now sees 2010 net income coming in at JPY35bn, down by over 27% from its previous target of JPY48bn.