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Domecq profit slips
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October 26, 1999: 6:27 a.m. ET
'No talks with Pernod' says U.K. spirits company
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LONDON (CNNfn) - Britain's Allied Domecq, the world's number two spirits distiller, unveiled an 8 percent slide in profits Tuesday, but attention centered once more on the possibility of a bid for the company.
Chief executive Philip Bowman told reporters the company had not been approached by French spirits maker Pernod Ricard (PRI). The French outfit has long been suspected of harboring ambitions to acquire its British rival, and raised a substantial war chest earlier this year.
Allied, which markets Ballantine's scotch, Sauza tequila, Beefeater gin and Kahlua liqueur, said operating profits for the period came in at 671 million pounds for the year ending in August, down 8 percent from a year ago. Sales fell 5 percent to 4.1 billion pounds.
Allied sold its struggling U.K. pubs business for 2.7 billion pounds ($4.5 billion) shortly after the end of the period and returned the cash to shareholders.
In a statement, Bowman claimed the remaining businesses "made good progress" during the year, "despite the inevitable distraction of the protracted disposal process."
Bowman promised, "We are actively seeking opportunities to improve the return on our existing assets."
Allied has been looking for a partner ever since global giant Diageo was formed in Dec. 1997.
Referring to the likelihood of further mergers in the international spirits industry, Bowman said management's objectives would strengthen "the return to shareholders in any future industry consolidation."
Allied Domecq stock rose 1 percent in London to 355 pence.
-- from staff and wire reports
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Allied Domecq
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