Carlsberg CEO Nils S. Andersen today (20 February) labelled its Baltic Beverages Holding (BBH) venture as the "main value driver" of the company as the brewing giant published healthy annual figures.

The Danish brewer a 15% jump in operating profit for 2006 thanks to turnaround in Western Europe and continued growth in Asia. Profits reached DKK4.04bn (US$713m) in 2006 as sales and earnings rose in Europe, a region that has been challenging for the brewer in recent years.

Group revenues rose 8% to DKK41.1bn as sales were also driven by a strong performance from BBH, Carlsberg's brewing venture with Scottish & Newcastle, the UK's largest brewer.

Andersen said one of Carlsberg's "two priorities" is to "continue to invest in the positive development in BBH". Carlsberg saw earnings from the business, which owns Baltika, Russia's largest brewer, soar 37% last year. BBH revenues leapt 21% as sales in Russia, the Baltic states, Kazakhstan and the Ukraine rose.

However, Carlsberg executive vice-president Jorgen Buhl Rasmussen said the brewer expects beer industry growth in Russia, BBH's largest market, to slow this year.

He said the Russian beer market would grow by 3-5%, slower than in 2006. Last year, beer sales had experienced "unusual growth due to the wine and spirits situation in Russia".

Russia's government last year moved to introduce a new duty regime for imported wine and spirits to stem the flow of bootleg alcohol. However, the low availability of the necessary tax stamps led to a shortage of wine and spirits on retail shelves.

Andersen also praised Carlsberg's performance in Western Europe, where profits jumped 20% thanks to higher earnings in the Nordic countries and the UK. Carlsberg has worked hard to drive down costs in these markets in recent years and Andersen said the brewer would continue to "improve competitiveness and efficiency in sales and route-to-market".

In Asia, where Carlsberg saw revenues jump 40%, Andersen said the brewer would look to make "further progress" in Laos. However, he insisted that Carlsberg's immediate goal in Asia is to build a footprint in key markets. He said: "We are not really focusing in Asia on driving profits in the short-term; we are focusing on build positions."