World: Asahi Group reports a 'higher than expected' profit increase in both its domestic and European operations in Q1

Japanese beverage firm Asahi Group has reported a 'higher than expected' profit increase in both its domestic and European operations, as the group saw operating profit rise 8.4% in the first quarter, ESM Magazine reported on May 14.

Profit from its Oceania business declined overall, however, the group said.

On a constant currency basis, the beer maker saw revenue up 5.1% in the period, a performance that it said was in line with expectations due to the group's 'appropriate pricing strategies and premiumisation policy'.

In terms of the performance of its global brands, Asahi Super Dry reported a 34% increase in volume sales in the period, while Peroni Nastro Azzuro saw volumes down 7%.

Volumes for its five core brands were up 14%, it noted.

In Japan, the group reported a revenue increase of 3.3% in its alcoholic beverage division, while overall revenue was up 8.9% and core operating profit rose by 10.3%, helped by increased volumes and a 'better price mix.

In Europe, revenue rose by 6.7%, year-on-year, helped by higher sales volumes, with core operating profit up 12.1%. In Oceania, meanwhile, while revenue rose by 4.0%, core operating profit came in 9.6% lower, due to lower sales volumes and higher variable costs, the group said.

'Despite strong on-premise sales of alcohol beverages and buoyant sales of non-alcohol beverages, overall revenue fell short of plan on lower-than-expected off-premise alcohol beverage sales,' it said of its Oceania business.

Looking to the remainder of the year, the group said that it is aiming to achieve a 3.6% increase in revenue and a 4.2% rise in core operating profit, by 'further improving our competitive advantage and improving our profit structures', it said in a statement.