Alcopop adds fizz to Bass results

Bass yesterday confirmed the dramatic success of Hoopers Hooch, the company's alcoholic lemonade that is estimated to have taken about 70 per cent of the fast-growing and controversial market for so-called alcopops.

Sales are running at an annualised rate of 300,000 barrels, Bass said in a trading statement, an extremely high sales volume for such a young product.

The figure adds substance to the claim last week by Matthew Clark, the cider maker, that the alcopops were eating into the markets traditionally enjoyed by traditional premium ciders and lagers. News of the shift in demand sent Clark's shares plummeting to half their value before the profit warning.

Bass's success in its drinks arm was offset by competition from another new threat as the National Lottery continued to divert leisure spending away from its Gala bingo clubs. At the half-year Gala saw profits fall from pounds 22m to pounds 19m and Bass, headed by Sir Ian Prosser, warned yesterday that, despite opening five more clubs, total admissions were running 4 per cent below last year. A higher spend per head had not been sufficient to compensate for lower numbers.

That had led, Bass said, to operating profits from its leisure retailing division, which includes the Coral betting arm, being "somewhat below last year". But Bass Taverns enjoyed a good summer and to date sales are 16 per cent higher.

In brewing, Bass continues to wait on the Office of Fair Trading which is taking submissions until next week on Bass Brewers' planned merger with Carlsberg-Tetley. A decision is expected by the middle of next month on whether to refer the deal to the Monopolies and Mergers Commission. Beer volumes in the 48 weeks covered by the trading statement increased by 2.5 per cent over last year, but Bass warned that continuing competitive pressures had caused another fall in unit margins in the on- and off-trade. The successful roll-out of Caffrey's had offset those pressures.

Bass's Holiday Inn subsidiary saw profits continue to grow in the second half. Revenue per available room increased by 6 per cent in the period in the US franchised hotels and by 8 per cent in Europe, the Middle East and Africa.