Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Fat Guy Pads Sun's Q2 Profits

Sun Interbrew, the Russia-Ukraine unit of Belgium's Interbrew, said Tuesday that second-quarter net profit rose 154 percent on volume growth and cost cuts, a result deemed excellent by analysts.

Net profit was up to 9 million euros ($10.5 million) from 3.5 million euros in the second quarter of last year. Core earnings rose 38 percent to 36.5 million euros, up from 26.5 million euros.

"Sun Interbrew has today reported excellent second quarter results, which match our aggressive forecast at the EBITDA level," United Financial Group analyst Alexei Krivoshapko said in a market comment.

The brewer said strong growth in earnings was capped by the euro's strength, a problem for a company whose revenues are in rubles but incurs some costs in foreign currencies.

Taking away negative currency effects, organic growth in earnings before interest, tax, depreciation and amortization was 50 million euros, up 23.5 percent.

Still, the brewer -- jointly owned by Interbrew and the Indian Sun Group -- said it had achieved a key aim to increase volumes by pushing out more beer in popular plastic packaging.

"[Sun Interbrew had] volume growth of 38 percent, far exceeding and significantly driving the total market growth of 8 percent," the company said in a statement.

It also increased sales of high margin brands in Russia, with sales of Ukrainian-brewed Stella Artois up 148 percent.

Among Russian brands, the growth leader was the premium Sibirskaya Korona brand, with sales up 52 percent, followed by the heavily advertised Tolstyak (Fat Guy) brand, up 51 percent, after expansion of plastic bottling lines.