DENMARK: Royal Unibrew slashes guidance on Q3 profit plunge
Royal Unibrew has more than halved its profit forecast for 2008, following a "disappointing" third quarter.
Pre-tax profit for 2008 is expected to be between DKK60m (US$10m) and DKK80m, instead of the previously anticipated range of DKK180-200m, said Royal Unibrew yesterday (20 November).
High costs for raw materials, deteriorating consumer confidence in key markets and one-off charges associated with acquisitions and disposals have hampered the brewer this year, and particularly in the third quarter, it said.
Pre-tax profit slid to DKK38m for the third quarter, down from DKK106m during the same period last year.
One-off charges included DKK57m of costs related to a reorganisation in Denmark, including the closure of the Aarhus brewery, the group said.
Decline on the Italian beer market, as well as declines in both beer and soft drinks sales in Denmark and Latvia, held sales back, it said.
Price increases and Poland helped revenue to climb by 11% to DKK1.15bn during the quarter, reflecting a 5% rise on an organic basis, however.
In its outlook, Unibrew said: "Due to the current global economic development and increasing uncertainty and caution on the part of customers and consumers, Q4 of 2008 is [also] expected to yield a profit before tax that is significantly below that of Q4 2007."
On revenue, it added: "In particular, sales in Eastern Europe are expected to continue to be affected by a significant shift in consumer confidence."
CEO Henrik Brandt, who took up his position on 1 November, is leading a review of the firm's strategic plan for the next three years.
Royal Unibrew, the Danish brewer, has reported a 8% drop in net sales for the first quarter due to heavy declines in Eastern Europe....
Danish brewer Royal Unibrew has sold its Koszalin brewery in Poland to Polish brewer Van Pur, as part of a restructuring plan....
Royal Unibrew has posted a significant drop in pre-tax profit for 2008, despite an increase in revenue....
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