Dutch brewer Grolsch has posted a slide in first-half profits as volumes in its home market fell.

Grolsch today (12 September) reported net profit for the six-month period of EUR6.5m (US$8.3m), a slight fall on the EUR7.4m of a year earlier. Sales for the half were up slightly by 3% to EUR152.2m.

Grolsch was quick to note that its profits had improved on the year when non-recurring items were stripped out of the figure.

Volumes in Grolsch's domestic market fell due to what it called the "deliberate scaling-down of promotional effort". However, the company said that was "more than compensated" by improved margins in the country and volume growth and better margins internationally.

"Over the years, the Dutch supermarket price war has resulted in extremely high promotional pressure in the beer segment," Grolsch said. "In view of the strength of its premium brand and the position it seeks to maintain for that brand, Grolsch has actively run counter to this trend and significantly scaled down its promotional effort in the first half of 2006. As expected, this resulted in some loss of market share."

Speaking to just-drinks today, a spokesman played down the impact of its battle with Dutch supermarket Albert Heijn. In January, the two companies failed to agree on wholesale prices for the year.

"As part of the dispute, we did not supply Albert Heijn for ten days at the beginning of this year," the spokesman said. "Although stock did get lower and lower in the stores, consumers were able to find Grolsch on the shelves throughout. Although it did run close, the supermarkets never ran out."

Abroad, while volumes in the UK remained more or less stable, the US is in a transitional period for Grolsch, as it switches to Anheuser-Busch to distribute its brands. The other core markets of Canada, France, Australia and New Zealand posted double-digit growth in the six-month period.

Grolsch added that its 2005 figures were inflated by a EUR1.5m pre-tax gain as the company changed its pension scheme into an average salary-based system.

Looking forward, Grolsch said that it intends to reduce promotional effort "significantly" in the Netherlands, preferring to focus on margins rather than volume. The company also expects 80% of its volumes in the US to have been transferred to the A-B distribution network by the end of the year.