Can maker reports record profits

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The world's biggest drinks can maker said strong growth in sales of fizzy drinks in the UK helped it to post record profits

The world’s biggest drinks can maker has said strong growth in sales of fizzy drinks in the UK helped it to post record profits.

Rexam, which makes cans for brands such as Pepsi, Carlsberg and Red Bull, said high levels of promotions of multipacks of soft drinks boosted its sales of cans in the UK in 2010.

Sales of beverage cans in Europe and Asia returned to growth in 2010, with volumes up 5%, following a poor year in 2009 when the turmoil in the global economy reduced demand.

The strong performance of the beverage can division and cost savings contributed to a 45% increase in underlying profits to a record £412 million.

Sales in its plastic packaging division, which makes containers for soft drinks, food and healthcare products, were broadly flat.

The FTSE 100 Index company plans to sell a division that makes container lids as part of its ongoing drive for efficiency savings.

Rexam closed a plant in the American state of Michigan in 2010 as it shaved £88 million from its costs in 2010.

Total sales were up 2% to £5 billion in the year and Rexam believes it can increase the rate of growth by targeting emerging markets, such as South America.

The company, which employs 23,000 people in more than 20 countries, said 2010 had been “an excellent year” and expects to make continued progress in 2011 despite warning that the global economy remains fragile.

Rexam’s profits were £7 million ahead of the City’s expectations of £405 million. But shares were down 3% after rising by 20% since December in anticipation of a strong performance.

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