The Japanese brewing industry finally had some news to toast this week as its top three brewers reported record profits. The sector has been dogged in recent years by falling beer sales. Sales were down again in 2004, however, cost cuts, subsidiaries and product innovation helped drive the profit growth.

Earlier this week, Japan's leading brewer Asahi reported a strong rise in profits for 2004, despite only a slight rise in sales. The company also forecast a 50% increase in profits for 2005. Asahi said that net profit in 2004 rose by 31.8% to Y30.6bn (US$291.4m) as cost cuts and favourable summer weather spurred consumption of its beer and soft drinks. Sales for the year increased by only 3.1%, however, with its beer and happoshu sales remaining flat for the 12-month period.

Today the brewer was joined by second place Kirin Brewery Co and number three Sapporo Holdings.

Kirin reported a rise of 52% in net profits to Y49.1 billion, a record for the company. Sales were up 3.6% to Y1.65 trillion. The company was boosted by its soft drinks division and Lion Nathan, in which it has a stake.

Meanwhile, Sapporo turned in a 92% leap in net profits to Y4.64 billion, boosted by the huge success of its beer-like product "Draft One".

Sapporo said it expects a further 21% rise in sales for the product this year.