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By: FRANCIS CHAN (COMPANIES CORRESPONDENT)
Publication: The Straits Times

PROPERTY once again took a back seat as food and beverage worked their magic on Fraser & Neave's (F&N) bottom line for the firm's strong first quarter.

The group racked up net profits of $156.5 million, 15.4 per cent up on the $135.6 million recorded a year ago.

Revenue was up 9.4 per cent to $1.55 billion for the three months to Dec 31, from $1.42 billion in 2009.

The robust performance was down to another strong showing from the food and beverage business, which surpassed the property unit as F&N's largest contributor by chipping in 58 per cent of group profits.

Higher sales of food and beverage products across key markets, as well as strong volume gains and contributions from new breweries in Indonesia and New Caledonia by its unit Asia Pacific Breweries (APB), helped boost earnings.

Breweries earnings soared 45 per cent to $122 million, while earnings from its soft drinks business rose 68 per cent, to $37 million.

Earnings from property, which continued to be supported by pre-sold development projects, fell 16 per cent to $108 million, on a 14 per cent decrease in revenue.

F&N said the drop in earnings resulted mainly from reduced contributions from development projects in China and Australia and the deconsolidation of Frasers Centrepoint Trust.

The group's shareholding was reduced from 51.9 per cent to 42.7 per cent in February last year after the sale of two retail malls to the trust.

Earnings per share for the quarter rose from 9.7 cents to 11.1 cents, while net asset value was $4.55, up from $4.38 in the previous quarter.

F&N's roster of products includes Tiger beer, isotonic drink 100Plus and dairy products.

Last year, F&N took 100Plus to Indonesia to tap its $6 billion soft drink market. That was part of a broader plan to expand its food and beverage business in the region.

Separately, first quarter profits at APB, in which F&N owns a major stake, rose 65 per cent to $115.7 million.

APB chief executive Roland Pirmez said earnings were driven mainly by organic growth and new businesses.

Revenue was $856.9 million, up 35 per cent over the same period last year. Earnings per share rose from 29.3 cents to 44.8 cents, while net asset value as of Dec 31 was $4.79, up from $4.38.

Neither firm declared a dividend payout. F&N shares closed one cent down at $6.06, while APB closed 58 cents lower at $20.50 yesterday.