Interbrew focuses on market-busting brands

A 5% decline in German beer consumption was not enough to dent the group's overall sales, which rose 7% in volume terms during the first half of 2003.

Interbrew's pre-tax profits rose almost 9% to 622m euros (XX).

But on a net basis, profits growth was disappointing - and one measure of earnings per share actually fell year on year - thanks to the negative effect of exchange rates.

Beating the market

Making meaningful year-on-year comparisons of Interbrew's figures is tricky, because the company is in the throes of restructuring some of its brands.

The firm argues that the best measure of its evolving performance is so-called "organic" growth, which strips out acquisitions and spin-offs, as well as effects such as exchange rates.

By these measures, Interbrew produced a 4.5% increase in volume sales, and a 4.7% increase in pre-tax profit in the first half of 2003.

The figures may seem modest, but Interbrew stressed that they beat the beer market as a whole.

Analysts, who had been braced for a moderately disappointing set of figures, said that results later in the year will offer a more useful guide.

Drinking up

This is because summer 2003 has been a bumper time for beer sales, especially in Europe.

In the UK, for example, sales of Stella Artois - the market leader - were up 12.3% during the first half-year alone, before the hot weather started in earnest.

Interbrew has huge market share in many regions - 14.4% in Russia, 18.4% in the UK, 42.8% in Canada - thanks to its aggressive strategy of acquiring a few key brands.

Two years ago, it bought German brewer Beck's, which boosted its share of the world's biggest beer market to 7.4%.