Carlsberg has shrugged off a fall in like-for-like beer volumes to report a rise in full-year earnings for 2009, but the Danish brewer expects Russia’s beer tax hike to hamper earnings in the first half of 2010.
Net profits for the 12 months to the end of December rose by 38% to DKK3.6bn (US$658m), compared to DKK2.6bn in 2008, Carlsberg said today (23 February).
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Net sales fell by 1% to DKK59.4bn, hit by unfavourable currency rates, while beer volume sales dropped by 4% on a like-for-like basis.
“We were well prepared for 2009 as we identified earnings protection and cash flow improvement as our top priorities going into the year,” said Carlsberg CEO Jørgen Buhl Rasmussen.
With beer markets across Europe set to remain sluggish in 2010, Rasmussen said that Carlsberg will focus on taking share off rivals, as well as further cost cutting.
“Profitable market share growth through accelerated initiatives on brands and innovations will be a top priority as well as continuing our focus on efficiency improvements.”
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By GlobalDataNet profits are set to grow by 20% in 2010, with operating profits flat against 2009, Carlsberg predicted.
But, a three-fold rise in beer tax in Russia, implemented from 1 January, will hamper earnings in the first half of 2010.
Stockpiling before the tax rise has led to significant destocking in January and Carlsberg expects a one-off DKK300m charge in 2010, said the group, which owns Russia’s leading brewer, Baltika Breweries.
Baltika improved market share by around 2% to more than 40% in 2009 and Carlsberg expects it to make more gains in 2010, despite a predicted 10% drop in beer market volume sales.
Carlsberg raised operating margin targets for the next three to five years, to ranges of 15-17% and 26-29% in Western and Eastern Europe respectively, from ranges of 14-16% and 23-25% previously. The group also introduced a target range for Asia of 15-20%.
