Chilean wine giant Vina Concha y Toro has reported a 16% rise in net sales for the first half of 2009, but operating profits fell as consumers in key markets traded down to cheaper wines.

Net sales for the six months to the end of June rose by 16.4% to CLP162.9bn (US$298m), with a 19% increase in the second quarter, compared to the same periods of 2008, said Vina Concha y Toro today (13 August).

However, operating profits fell by 8% for the half-year, to CLP21.4bn, as consumers sought out bargains in the midst of a global recession.

"This mainly reflects the higher average cost in this period and a change of the mix, with larger sales in the segments with lower prices, due to the economic cycle and higher promotional activity in the UK," said the firm, which owns the Casillero del Diablo brand.

Second quarter operating profits fell by 5%, showing a slight improvement on the first, although operating margins for the second three months slipped to 14%, down from 18% last year.

Net profits for the six months rose by 21% to CLP21.4bn, partly boosted by a CLP2.3bn one-off exchange rate gain.

Net sales in Chile rose 4.5% for the second quarter, on a 5.3% volume sales rise.

For Vina Concha y Toro Q1 results, click here.