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High costs, weak economy blamed for 55 percent drop

APIA, Samoa (Samoa Observer, Aug. 25, 2010) - The company which owns the Samoa Breweries has recorded a 55 percent decline in consolidated profit for the year ended 30 June 2010.

Difficult economic conditions and booming fuel prices last year have been blamed by the Fosters Group for the decline. In a market announcement yesterday, Foster group revealed that consolidated net profit before tax decreased from WST15.54 million [US$6 million] in 2009 to WST6.99 million [US$2.7 million] in 2010.

Company Director Michael Stoneman said overall group business performance for the Pacific was significantly affected by adverse trading conditions in the Fiji and Samoa markets and key events which led to this were the global financial crisis and oil price increases.

Mr. Stoneman said for Fiji, sugar production and tourism numbers continued to decline relative to prior years while the devaluation of the Fiji dollar on input prices as well as imports further dampened consumer spending.

He said sustained high oil prices and the devalued dollar applied significant pressure on costs of production as well as high maintenance costs incurred during the year to improve efficiencies.

But despite the increase in prices of Fosters products and sales mix, sales revenue increased during the current financial year by 13 percent from WST65 million in 2009 to WST73.5 million in 2010.

Fosters group said basic earnings per share also decreased from WST1 in 2009 to 51 cents per share in 2010.

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