Scottish and Newcastle sold its 1,400 UK pubs in October

The group recently sold its entire retail estate to private pubs group Spirit Amber for �2.51bn in order to slash debts and fund expansion.

S&N wants to focus more on brewing and brands, in a portfolio which includes Fosters, John Smiths and Kronenbourg.

Looking ahead, the company said it expected "reasonable" market conditions despite fragile market confidence.

Russian growth cut

Chief executive Tony Froggatt said the group expects growth in beer volumes to rise by over 4% in the half-year, with Foster's up 9% and Kronenbourg up 6%.

The company plans to brew the two brands in Russia, where it jointly owns Baltic Beverages with Denmark's Carlsberg. However, it has cut expectations for growth in the Russian beer market to 5% in 2003 from around 8% previously.

Meanwhile, Scottish & Newcastle's share price has underperformed the FTSE 100 index by 30% since the start of the year.

The company sold its 1,400 UK pubs in October for a reported pre-tax profit of �316m.