Carlsberg has said it expects profits from its German business to fall next year due to higher costs and continued tough competition.

The Danish brewer, which holds the number five spot in Germany, said that earnings would be squeezed as raw material costs rose and the company prepared for a tax hike.

A spokesman for Carlsberg Deutschland told just-drinks today (22 September) that fierce competition within the German beer market meant the brewer was unable to pass those costs onto consumers.

"The competition is that intense that we cannot pass on the costs to consumers. We'll have to compensate for that within the company," he said.

The brewer would continue to look for ways to improve efficiency at its four breweries throughout the country. Around 40 jobs will be lost in Hamburg next year, the spokesman said.

He added: "We are now a really slim company and we consider ourselves fit for the future - but it's not a rich future, not just for us but for the whole industry."