Carlsberg says beer sales robust despite rising living costs

By Jacob Gronholt-Pedersen

COPENHAGEN (Reuters) -Danish brewer Carlsberg mentioned on Wednesday it had not seen rising dwelling prices impacting beer gross sales, however that greater uncooked materials costs would strain earnings within the second half of the 12 months.

The world’s third-biggest brewer mentioned gross sales within the second quarter have been boosted by the reopening of bars and eating places in most markets.

“To date we do not any see any influence in our figures (from rising inflation),” Chief Govt Cees ‘t Hart mentioned in a convention name.

“When folks spend much less on holidays, automobiles or a brand new fridge, they’re at the very least keen to have a premium beer on the finish of the day,” he mentioned.

The corporate, which additionally produces manufacturers akin to Kronenbourg 1664, Tuborg and Somersby, lifted its revenue development forecast final week on the again of robust performances in Europe and Asia.

The corporate’s volumes grew organically by 8.7% within the quarter, with gross sales reaching 20.51 billion Danish crowns ($2.81 billion), in comparison with the 21.6 billion forecast by analysts in a ballot compiled by the corporate.

“We at the moment are effectively forward of pre-pandemic ranges, nonetheless we see darkish clouds on the horizon,” ‘t Hart mentioned. We are going to see full impact of rising enter prices within the second half of the 12 months.”

The corporate expects “excessive single-digit-percentage” natural revenue development for the complete 12 months, a lot beneath the 32% development it achieved within the first six months of the 12 months.

Rival Heineken mentioned this month that buyers purchased extra beer within the first half of the 12 months regardless of price of dwelling pressures, however that it anticipated rising prices to squeeze revenue margins subsequent 12 months.

Shares in Carlsberg traded 1.4% greater at 0726 GMT. The inventory’s worth has elevated 25% since a trough in early-March.

Carlsberg, which has eight breweries and eight,400 workers in Russia, mentioned in March it will promote its enterprise within the nation, becoming a member of an exodus of Western firms since Russia’s invasion of Ukraine.

The sale would more than likely be concluded 12 months after it introduced the plan to divest, ‘t Hart mentioned.

On Wednesday, the corporate reported a write-down of its Russian enterprise of 9.6 billion crowns, leading to a internet loss for the primary half of the 12 months of 5.28 billion crowns.

($1 = 7.3048 Danish crowns)

(Reporting by Jacob Gronholt-Pedersen; enhancing by Edmund Blair, Jason Neely and Tomasz Janowski)