STRONG sales of beer have motivated Coopers Brewery to undertake a $20 million capital expansion.

In the six months to December 31, 2012, beer sales jumped 13.6 per cent compared with the previous corresponding period.

Coopers managing director Tim Cooper said that stocks of Pale Ale were dangerously low during the festive season.

The brewery intends to double the size of its existing 250sq m Regency Park lager cellar, along with installing a second bottling line and two additional fermenters, to meet growing demand.

Dr Cooper said the new line would be dedicated to bottling Coopers’ traditional products, including Pale Ale, Sparkling Ale, Mild Ale and Stout, at 1200 bottles a minute.

The company would also continue to produce Celebration Ale, launched in the company’s 150th anniversary year, which has experienced sound sales.

The old line would then be used to bottle the lager range Coopers’ has negotiated to produce through Sapporo and Carlsberg.

Dr Cooper said the production of those beers – after a deal was negotiated with Sapporo starting in September 2011 and with Carlsberg from July last year – accounted for nearly half of the company’s increased beer sales.

“It is very gratifying, considering the whole beer market is going backwards and has been for the past three calendar years now, declining about 4 per cent each calendar year in Australia,” he said.

In the 12 months to June 30, 2012, Coopers turnover rose 7.6 per cent to a record $186.3 million, while after-tax profit reached a record $27.2 million, up 18 per cent on 2010-2011.

Dr Cooper said the cellar extension and installing two additional fermenters, taking the total number at the brewery to 24, would cost about $3.5 million.

Negotiations have started with specialist equipment suppliers for the bottling line and contracts were expected to be signed early this year.