Magazine article Business Asia

Kirin, Asahi Slash Costs, Lift Profits

Magazine article Business Asia

Kirin, Asahi Slash Costs, Lift Profits

Article excerpt

While Japan's overall beer market continues to suffer a hangover from the weak economy, industry leaders Kirin Brewery and Asahi Breweries reported strong earnings rises in the first half of 1999 thanks mainly to cost-cutting measures.

However, third-ranked Sapporo Breweries took a nosedive in its half-year sales and profits. With the domestic beer market facing slow demand and little room for further growth, Japanese breweries will have to squeeze out profits through cutting costs or taking business from each other, analysts said.

Kirin said its sales in the January-June period rose 0.1 per cent from a year ago to 514.46 billion yen (US$4.47 billion). In terms of sales in the first half of the business year, it marked the first year-on-year increase in five years.

The company's parent current profit showed a more robust year-on-year increase of 19.2 per cent to 30.69 billion yen.

"Our cost-cutting measures under business plans started last business year have borne fruit this year," a Kirin spokesman said. …

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