Bid target Foster's unveils fall in profits

Foster's, the Australian brewing giant that is at the heart of takeover speculation involving potential South African, American and Japanese bidders for its beer arm, yesterday posted a 4 per cent dip in annual profits to A$711.3 million (£407.5m).

Chief executive Ian Johnston stonewalled the speculation that has featured SABMiller, Coors of the US and Japanese giant Asahi, saying the planned demerger of Foster's beer and wine businesses next spring remained on track.

Johnston said: "There are a lot of issues to consider, and we are on track to unscramble these complexities." He said Foster's, whose main brands are the eponymous lager, Victoria Bitter and Pure Blonde, was working on separating the beer and wine divisions' commercial, tax and accounting functions, and in coming months would split corporate structures and logistics.

The group's annual earnings outstripped market expectations of A$680m, while second-half profits came in at A$355.6m against A$330m a year ago.

Theo Maas at Arnhem Investment Management said: "If we do have two or three bidders I doubt they would wait till the demerger has gone through."