Analysis

Carlsberg’s Q1 performance by region - Focus

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Earlier today, Carlsberg released a trading update for the first three months of 2016. Net sales grew in organic terms by 2% in the first quarter, as group volumes dipped by 2%. Here, we look at the company's performance during the three-month period by region.

Carlsberg released its first-quarter trading update today

Carlsberg released its first-quarter trading update today

(The following sales figures are in reported terms, where ForEx led to a 3% decline.)

Western Europe - Sales -4.7% to DKK7.78bn (US$1.19bn), volumes -7.6% to 9.7m hectolitres

With the overall beer market in the region estimated to have been flat in the quarter, Carlsberg's UK unit struggled after major supermarket chain Tesco delisted several SKUs in October. Sales in Finland and Poland had to deal with the company's withdrawal from "margin-dilutive contracts". Price/mix of +3% in the region was partly thanks to Carlsberg's focus on "achieving the optimal balance between market share, the gross profit after logistics, margin and operating profit". 

Eastern Europe - Sales -2.1% to DKK1.7bn, volumes +5% to 6.3m hectolitres

Carlsberg cycled easy comparisons in Russia from a year earlier, when the group's Baltic Beverages Holding division reduced its distributors' stock levels. Minus currency impact, sales in Eastern Europe increased by 20%, with price/mix improving by 12% due to last year's price increases and "a weak mix" in Q1 2015, Carlsberg said. Volumes, meanwhile, were up in Russia, Ukraine and Kazakhstan.

Asia - Sales -0.7% to DKK3.51bn, volumes flat at 8.7m hectolitres

A 6% rise in price/mix in Asia helped organic sales rise by 5%. Although China saw volumes slide, thanks to the closure of several breweries in the east of the country, volumes improved in India and Nepal. Vietnam's sales in the quarter were hit by the sell-in for Tet - the country's New Year - and fell in the last quarter of 2015, rather than in Q1. That said, Heineken last month hailed the country's New Year celebrations for contributing to its volumes lift in the same three-month period. Carlsberg also flagged the launch of Tuborg in Vietnam last month. The brand boosted its volumes in Asia by 25% in the quarter.


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