Cains slips into the red amid last attempts to save brewery

08 August, 2008

Brewer fights for survival after reporting a loss of £4.6 million

Liverpool brewer Cains is in last-ditch talks with

bankers to save it from liquidation after reporting a £4.6 million loss in the six months to April 27.

The AIM-listed

brewer and pub operator has been forced to suspend stock market trading after Bank of Scotland refused its request for an extended overdraft.

As well as facing pressure from shareholders, who will receive no dividend and have been warned further losses are likely, Cains is in debt to HM Revenue & Customs and faces a winding -up order on Aug 12.

In a statement issued on Aug 1, the brewer said: "The directors believed that the company would be able to reach agreement with its bankers regarding appropriate levels of funding, but noted

there was a material uncertainty as the group's ability to continue as a

going concern.

"The company's bankers have

informed Cains

they are not prepared to support the proposals that have been put to it. Accordingly, the Board of Cains requested the suspension. A further announcement will be made as appropriate."

Brewery sales, excluding those to its retail estate, were down almost 15%, mainly due to lower own-label sales. But Cains said the trend had been reversed in the 12 weeks following the period end, "with some significant volume increases from major retailers".

Sudarghara Dusanj, Cains Beer Company chief executive, said: "As predicted, the smoking ban and reduced levels of consumer confidence have had a significant impact on the short -term trading position of the business."

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