The company reported on Friday that it revenue was down 6 per cent to RM452 million, after beverage sales fell by 17 per cent compared with the prior year's three month period. Beverages make up half of the group's revenue.

"Soft drink sales have been weak since February, a reflection of poorer consumer sentiments and demand," the company said in a statement to Bursa Malaysia.

During the last nine months, beverage sales are down more than 6 per cent on the 2005.

"Recent price increases and inflationary pressures have dampened consumer sentiments, which have negatively affected demand for our products," added the company.

The poor performance at the beverage unit took its toll on operating profit during the third quarter which was down by 16 per cent.

But F&N has seen encouraging growth in its glass business, with sales up 13 per cent in the third quarter and almost 7 per cent for the year to date. The glass operations are doing particularly well in China, with sales up 29 per cent in the last three months.

F&N said its performance for the remaining quarter hinges on the recovery of soft drink sales but added that overall, the full year results should be satisfactory.

It said "intensive promotional activities are being carried out to boost sales in the remaining months of the year".