Dutch brewer Grolsch has issued an upbeat forecast for 2006 despite reporting falling profits last year.

Grolsch said it expects volumes to rise across its key markets this year even after seeing earnings hit by severe price discounting in Holland and the UK in 2005.

The brewer today (2 March) reported a 12.7% fall in net profit to EUR18m (US$21.58m). Sales dipped slightly to EUR312.3m from EUR314.8m a year earlier.

Grolsch said global volumes fell to 3.4m hectolitres from 3.3m hl last year. Holland accounts for half of its sales and Grolsch said domestic volumes were hit by the price war among Dutch supermarkets. However, sales in the Dutch on-trade rose, the brewer added.

Sales in its international markets rose by 10% but falling volumes in the UK weighed on the results.

Grolsch pointed to its "deliberate refusal" to cut the price of its flagship brand in the UK for declining sales in that market.

Nevertheless, a Grolsch spokesman signalled the brewer's optimism for the year ahead.

"If you look at 2005, it went quite well. The UK suffered significant volume decline but our other international markets showed considerable growth - and we think this will continue in 2006."

The spokesman said Grolsch had a series of marketing initiatives in place to boost sales in the UK, where Coors Brewing brews the brand under licence.

Grolsch also plans to roll out its Grolsch Premium Weizen brand across Holland after an initial launch in the east of the country last year.

The spokesman also pointed to the brewer's US distribution deal with Anheuser-Busch, which has is set to start on 1 April.