SPC Ardmona was in profit last year but had not performed as well as hoped, parent company Coca Cola Amatil said last week. The company, which recently announced sackings at its Goulburn Valley factories, returned a profit somewhere around last year's result of $46 million preincome tax and interest. In previous years SPC Ardmona's profit was recorded as a separate line item in published reports but this year it was contained with the food and services division results.

Coca Cola Amatil chief Terry Davis announced a CCA group profit of $366 million, up 13 per cent. Mr Davis agreed that the company was taking a close look at SPC Ardmona's costs and confirmed that a rationalisation of the two plants in Shepparton and Mooroopna was under consideration. "Any business that is making less than optimal returns we would have a close look at", Mr Davis said.

"But relative to any other food business the results are holding up okay but not as good as we would like, and we will have to take whatever action we have to, to maintain the profitability of the business." Mr Davis said CCA had substantially increased the level of investment to reduce its operating costs over the past two to three years. "Over time we will have to have a close look at whether it does make sense to have two separate facilities.

"If we were starting from scratch you certainly wouldn't have two facilities make the same product at two different locations 15 km away." Mr Davis referred to the droughts and frosts and said that was why they had been rapidly establishing joint-venture operations in Thailand and China (already in Spain). "We have additional ventures in South Africa and China to reduce the seasonal risk across the business. And the progress we are making there is pretty solid."

Mr Davis said the China operation was a joint venture selling into the United Kingdom and United States using local product. He said SPC and Goulburn Valley brands remained the two biggest fruit bands in Australia while Ardmona was the strongest tomato brand. He said higher tin plate and PET resin costs had impacted on the business' cost base. "In the United Kingdom, SPC canned fruit is currently the number three value brand and achieved strong volume growth in that market of almost 15%.

"The global launch during the year of the new 'SPC Nature's Finest' range of fruit in plastic also delivered profitable volume growth in all key international markets." CCA's food and services division recorded earnings before income tax of $87 million. Two weeks ago SPC Ardmona began winding up 50 jobs across its Australian operations,including the Goulburn Valley factories.