Profits make its Lion Nathan merger the toast of Kirin

Merged after Kirin's $3.5 billion acquisition of Lion Nathan in October, the company's portfolio of beer, spirits, milk, yoghurt and cheese has generated a full-year profit of $539.7 million.

The accounts combine for the first time the sprawling food and drink assets of Lion Nathan, National Foods and NSW milk processor Dairy Farmers. It includes three months ownership of Lion Nathan, which helped lift group operating profit before significant items to $298.9 million.

Documents lodged by the privately run Lion Nathan National Foods show the combined businesses, which own popular brands such as Tooheys, Boag's, PURA Milk, Big M, Coon and Berri, had total assets of $13.447 billion as at December 31.

While Lion Nathan fights a pitched battle with Foster's Group for the loyalty of Australian beer drinkers, its joint venture with the Dutch giant Heineken has generated above-market growth for the Heineken brand.

Heineken Lion Australia reported sales of $64.67 million for the year to September 30 against sales of $55.535 million in 2007-08.

Heineken's sales growth of 16.44 per cent is robust compared with flattening revenue for most traditional beers, with the Australian beer market shrinking from 6 per cent growth last year to about 1 per cent this year.

Lion Nathan National Foods also revealed the costs associated with the acquisition by Kirin, booking $10.6 million for the merger in the 2009 accounts. Also included was $31.7 million in restructuring costs related to the integration of Dairy Farmers and $37.1 million in manufacturing site closures.