S&N on-trade beer volumes drop 5%

Scottish & Newcastle beer volumes are booming in the off-trade but are declining in pubs, its full-year results reveal. S&N, Britain's biggest brewer, saw a 5% decline in beer volumes in pubs in 2003 while the off-trade grew by a healthy 9%. Christmas was a particularly strong trading period in the off-trade with volumes up by 10%. The company claimed it had "continued to resist discounting as heavily as competitors in the off-trade". S&N reported that demand in pubs was weaker than in 2003, particularly on the high street, but blamed some of the volume decline in pubs on supply chain difficulties. Analyst Stuart Price, of Panmure Gordon, said the results in the take-home sector were driven by steep discounting by the supermarkets "paid for, in part, by S&N". Last year saw volumes of Foster's, John Smith's, Kronen-bourg 1664 and Strongbow grow by 3%. Volumes were flat in the four months to April, but grew by 4% from May to October and by 6% in the final two months of the year. The brewer cited the good summer and the swift integration of Bulmer's into the S&N business for a 7% increase in Strongbow sales. The company said: "We have already realised approximately £6m of the total cost savings of £16m that we anticipated when we bought the business ­ and we are on track to realise the full benefit in 2004." Profits rose from £585m to £636m on turnover up 17% to £5.5bn.