11/9/2011 7:00 


Third quarter results in line with expectations

• In the first nine months of 2011, Carlsberg Group's beer volumes grew by 2%, net revenue growth was 4% while operating profit declined by 12% in line with expectations.

• In Northern & Western Europe, the total beer market declined slightly in the first nine months with poor weather conditions in July across the region making the trend worse in Q3. Excluding the tough comparisons due to very favourable weather conditions last year, the underlying Russian market declined in Q3 in line with Q2 and full-year expectations. The market is still negatively impacted by the high price increases to compensate for the significant excise tax increase in 2010. Most markets in Asia continued to grow at high single-digit percentages.

• In Northern & Western Europe, the Group's market share improved slightly, mainly driven by Poland and the UK. In Eastern Europe, the Ukrainian business continued to improve its market share while our market share in Russia declined. In Asia, market share gains were once again achieved across most markets in the region.

• The Group achieved a positive price/mix of 4% with a particularly strong contribution from Eastern Europe and Asia. This reflects the Group's ambition to drive a profitable development through both volume and value share growth, and was supported by slightly higher marketing investments, primarily in key markets in Eastern Europe and Asia. During the year, the Carlsberg brand was repositioned and a number of product launches undertaken.

• Group beer volumes grew by 2% to 91.8m hl with 1% organic growth. Organic beer volumes in Northern & Western European were flat while Eastern Europe declined by 1%. Asia continued its strong growth and delivered 10% organic beer volume growth. Q3 Group organic beer volumes fell, as expected, by 3% impacted by the Russian market decline and the poor weather conditions in Northern & Western Europe in July.

• Net revenue increased by 4% to DKK 48.7bn (DKK 46.7n in 2010) with 5% organic growth. Q3 net revenue declined by 2% to DKK 17.4bn (DKK 17.7bn in 2010) with flat organic development.

• Operating profit declined organically by 12% to DKK 7,982m (DKK 9,122m in 2010). Q3 operating profit was DKK 3,284m (DKK 4,156m in 2010), a 20% organic decline. Weaker performance in Eastern Europe, higher input costs than last year and higher sales and marketing investments, primarily in key markets in Eastern Europe and Asia, impacted profits.

• Net profit was DKK 4,237m compared to DKK 4,645m in 2010 (adjusted for the DKK 390m non-cash, non-taxable income in Q1 2010).

• Free cash flow was DKK 2.6bn (DKK 5.8bn in 2010). Trade working capital to net revenue (MAT) was 1.9%, in line with Q2. Net interest bearing debt was DKK 32.7bn (DKK 32.7bn end 2010), impacted by acquisitions, share buy back and currency impact.

• As Q3 developed as anticipated, all major assumptions for the year are kept unchanged and the Carlsberg Group maintains its 2011 earnings expectations:

• Operating profit before special items of around DKK 10bn.

• Adjusted net profit growth of around 5-10% *)

Commenting on the results, CEO Jørgen Buhl Rasmussen says: “2011 has been a challenging year and we have faced headwinds from rising input costs, adverse weather conditions and soft trading conditions in our largest market. Whilst we have been trying to compensate for the negative impact of these challenges through continued focus on driving efficiency in all that we do, we have at the same time kept our focus on profitable development by balancing volume and value growth. With an uncertain outlook for the global macro economy and consumer sentiment, we will closely monitor changes in our markets, so that we can adjust our investments in sales and marketing activities accordingly. Nevertheless, we already plan to speed up structural initiatives to become even more efficient and customer focused and we will continue to drive value in the category, which will also be necessary to offset the continued input costs inflation.”

Carlsberg will present the financial statements at a conference call for analysts and investors today at 9.00 am CET (8.00 am GMT). The conference call will refer to a slide deck, which will be available beforehand at www.carlsberggroup.com.


*) Reported 2010 adjusted for the DKK 598m non-cash, non-taxable income in special items related to a new acquisition accounting regulation.


Read the full announcement on the link in the right column on this page. 



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