Focus - Carlsberg's H1 Performance by Region
Carlsberg's shipments to Russia fell by 11% in H1
Earlier today, Carlsberg reported flat first-half profits and sales and issued a profits warning for the full-year as Eastern Europe remains challenging. Here just-drinks looks at the group's performance by region:
The brewer's first-half sales in the region rose by 4% on a reported basis to DKK18.6bn. Operating profits in the six months were up by 9% to DKK2.3bn. Total volumes climbed by 5% to 32.2m hectolitres. Carlsberg said the region was boosted in Q2 by the FIFA World Cup and Easter.
In Poland, volumes grew by 6%. In France beer volumes rose by 25% after destocking in last year's Q1. In the UK, the group saw “strong growth” in Q2 helped by the weather and FIFA World Cup promotions. The Balkan markets were impacted by “severe flooding”, Carlsberg said.
First-half sales, on a reported basis, fell by 18% to DKK7.5bn, while operating profits slipped by 11% to DKK1.5bn. Total volumes slid by 10% to 20.6m hectolitres. The group's shipments to Russia decreased by 11%, as the market's overall volumes fell by 6-7%. Carlsberg blamed the “uncertain macroenvironment, weak economic development and bad weather, particularly in June”.
The group's volume market share in Russia fell by 120 basis points to 37.4%.
In Ukraine, Carlsberg flagged the overall beer market declined by around 10%, due to the “very challenging and uncertain macroeconomic climate coupled with a 43% beer tax increase in May”. On the political situation in Ukraine, the company said: “We have been able to operate our business... with limited disruptions, although distribution to some cities in parts of eastern Ukraine has been challenging and, in February, we had to stop production for a few days."
The group's first-half net sales rose by 27% to DKK5.9bn in the region, while operating profits also climbed, by 8% to DKK1.04bn. Total volumes were up by 20% to 19.6m hectolitres.
In China, the group's H1 volumes rose by 31% due to the consolidation of Chongqing Brewery Group, which it agreed to acquire late last year. However, volumes on an organic basis fell, with “unrest and bad weather in Xinjiang, the reduction of unprofitable products, and bad weather in Chongqing” being blamed.
In Indochina, Carlsberg's beer volumes grew organically by 2% after a “continued strong performance” in Cambodia and Laos, driven by our strong local power brands Angkor and Beerlao. The Vietnam market recovered during Q2, following a weak start to the year, Carlsberg said.
In India, the group saw volumes grow “almost 40%”, driven by a “very strong performance” of Tuborg. The country is now the lager brand's biggest global market. Carlsberg's market share in India now “exceeds 10%”, it said.
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