A NORTH-EAST brewery, which is the main supplier of beers to the Houses of Parliament, has reported a 6.6 per cent increase in sales in the past six months.

The Federation Brewery was formed after the First World War when a group of North-East working men's clubs formed an independent co-operative to build their own brewery serving working men's and other clubs across the North-East.

Yesterday, it was announced that in the half-year to March 31, there was a 6.6 per cent rise in Federation Brewery sales despite the competitive nature of the brewing market.

It is the first time the company has seen an increase in sales since 1993.

In the past six months, the company has won two major new own-label canning contracts and there are plans to address recent declines in pub trade.

The company has also compiled a new brand portfolio which has helped make in-roads into fresh markets.

Earlier in the year, the brewery installed a £3m multi-purpose bottling line, as part of a major investment programme and in September last year a state-of-the-art kegging plant was commissioned at a cost of £2m.

Unlike other brewers, the Federation Brewery does not operate its own estate of public houses. All sales are through an ever widening spread of free trade clubs, hotels, restaurants and off-licence trade.

Geoff Hodgson, chief executive at the brewery, said: "I am delighted to report an increase in sales for the first time since 1993.

"Although our trading surplus is behind last year, I am confident that with our major capital investment programme and new sales and marketing initiatives, we are well placed to demonstrate an improvement in our second half performance."

The brewery's £18m, 20-acre Dunston complex, close to the A1, opened on June 17, 1980, and was at the leading edge of technology at the time, including ground-breaking computer controlled equipment.

But the brewery still uses its original sources of water and raw materials. The most important traditional asset, namely the unique Federation yeast, is still carefully nurtured by the brewing team