Sun Interbrew, the Russian brewing subsidiary of the Interbrew group, reported net sales of €128.1m for the second quarter, up 11% from €115.4m in the corresponding period last year. However, the figure was 1.5% below analysts' forecasts.

Sun Interbrew said it had lost market share in the domestic beer market during the second quarter and as a result it expects its net profit for the year to be down from 2001. Analysts have also lowered their forecasts for 2002 net sales by an average of 2%.

Net profit fell in the second quarter fell from €8.6m to €3.5m. Sun Interbrew attributed the disappointing performance to higher-than-expected foreign exchange losses of €5.6m in the second quarter against a gain of €979,000 last year.

The company also said that its current packaging - glass bottles rather than cans and PET - was more expensive than PET and cans. It said the majority of its €35.2m capital investment in the second quarter went towards the installation of canning and PET bottling lines. The company said the switch to cheaper packaging in the fourth quarter of 2002 would result in a rise in profits.