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DB'S Impressive Profit Growth Continues

DB'S Impressive Profit Growth Continues

DB Breweries Limited has maintained its rising earnings trend, today posting a $25.4 million net profit on the back of continued sales growth -- sales were up 10.7% -- driven by the popularity of its premium and mainstream brands.

Net profit (after tax and minorities) was up 13% on the comparative period last year [2002 $22.6 million].

For the 12 months ended 30 September 2003, earnings before interest and tax (EBIT) were up 13% on the previous year at $34 million [2002 $30 million]. The company's strong performance was underpinned by a significant lift in sales, with a 10.7% increase to $317.8 million [2002 $287 million].

DB Breweries' Chairman Sir Colin Maiden said the directors were pleased to announce a fully imputed final dividend of 20.5 cents per share and a supplementary dividend to non-resident shareholders of 3.62 cents per share (to be paid on 3 December 2003 to shareholders on the register at 5pm on 21 November 2003).

"Over past years shareholders have continued to see good dividend growth and this year's excellent result is no exception," said Sir Colin. Sir Colin said that the company continued to build value, with shareholders' equity at $147.2 million as at 30 September 2003, compared with $136.6 million for the same 2002 period. Net operating assets were $178.4 million, up from $173.8 million, with net debt falling from $31.8 million in 2002 to $25.3 million as at 30 September 2003.

DB Breweries' Managing Director Brian Blake said the excellent result was due to the popularity of DB's brands, and the commitment and drive of its staff to increased efficiencies and operational excellence.

"We have continued to strengthen the profile and relevance of our key brands within the marketplace and we have witnessed considerable growth, particularly through the consolidation of our position in the premium segment," he said today.

Heineken, Monteith's and Tui all achieved double digit sales growth.

"Our key brands have had an extremely high profile over the past 12 months through a number of innovative marketing and sponsorship campaigns.

"Kiwis want products that reflect their lifestyles, personalities and tastes, and the diversity of the DB brand portfolio fulfils the demands of Kiwi consumers."

Mr Blake said that DB had also been very focused on efficiencies, both operational and structural over the past year.

"Significant cost reductions have been achieved, with a strong contribution from efficiencies gained through the $60 million investment in the redeveloped Waitemata site.

"In addition, a comprehensive review of the company's organisational structure and business processes resulted in a targeted restructuring programme," said Mr Blake.

"This flattened the company's structure and ensured that the sales teams could be more responsive to customer needs and market movements.

"The restructuring, following a review of the company's long term plan, was implemented over a four month period without any negative impact on the strong operating performance of the company," said Mr Blake.

>From a brand perspective, Mr Blake said the DB portfolio continued to improve its competitive position through high profile and innovative marketing campaigns.

"Heineken's performance once again allowed the brand to retain its dominant place in the premium beer segment," said Mr Blake.

Heineken is a major sponsor of the Rugby World Cup 2003 and was the official beer sponsor for the Auckland Festival (AK03).

DB Breweries remains focused on its vision of being New Zealand's most valuable brewery.

The company's organisational review and subsequent restructuring mean it is now well equipped to become more operationally effective through better alignment of business goals with business structures and processes.

The company is well positioned financially to be a key player in developing the total New Zealand beer market, including growing equity in key brands and implementing an upweighted distribution strategy.

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