After a year of transformation Foster's Group sits at the doorstep of a period of sustained strong earnings growth,
While its early days, full-year earnings for wine are on track. Expect momentum to build in the second half.
The Australian wine consumer represents less than 15 per cent of our profit pool,
While Foster's scale and efficiency sees us better placed than anyone from a production perspective, the (Australian) market is struggling to absorb the huge volumes of wine that are discounting and squeezing sales margins.
Our decision to proceed with this transaction has been made in the context of increasingly favorable industry trends, and greater confidence in the outlook for the North American wine market and New World wine markets generally,
Let me assure you that I am not satisfied making 40-50 million on the same volume of beer (as) CUB sells.
We had strong pricing and had volume growth in beer for the first time in a decade. On top of that we are taking costs out of the business.
An extremely competitive retail market is pushing extensive discounting and large volumes of wine at low prices, and New World competitors from South America and South Africa are also impacting on the market.