Japan: Sapporo Holdings Ltd. said on February 18 it posted a record group pretax profit of 18.01 billion yen in the 2004 business year due mainly to good sales of a beer-like sparkling alcoholic drink, widely dubbed "third-category" beer, and cost cutbacks. In its consolidated earnings report for the January-December period, Sapporo Holdings, the parent of major beer maker Sapporo Breweries Ltd., said its pretax profit soared 165.2 percent from the previous year on a 3.2 percent rise in sales to 494.93 billion yen.

The company said overall sales at its mainline alcoholic drink business sector rose 7 percent to 364.5 billion yen as its spirited sales of the Draft One third-category beer more than offset the effects of falls in sales of beer and "happoshu" low-malt beer.

Third-category drinks are becoming popular because they are cheaper, being subject to lower liquor taxes due to the absence of malt and wheat in their ingredients. The government levies a 24.20 yen tax for every 350 milliliters of third-category drinks, against 77.70 yen for beer.

The firm's net profit surged 92.4 percent to 4.64 billion yen with net profit per share coming to 13.07 yen, compared with the previous year's 6.95 yen.

But the scope of the net profit growth was limited compared with that of the pretax profit, as it booked a 20.14 billion yen extraordinary loss, including a 7.59 billion yen loss from fixed asset sales and a 6.03 billion yen evaluation loss on real estate.

Sapporo Holdings said it will pay a full-year dividend of 5 yen per share, unchanged from the previous year.

For the business year to Dec. 31 this year, it forecast its pretax and net profits will respectively come to 16.5 billion yen and 8.0 billion yen on projected sales of 482.0 billion yen.

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