World: Carlsberg’s global sales down 1% in Q3 2017
Carlsberg has posted a net sales decline of 1% in the third quarter of the year to DKK 16.7 billion ($2.61 billion) as it struggles to maintain sales in Russia, FoodBev reported on November 2.
The Danish brewer said the dip was due to regulations in Russia to limit excessive beer consumption as well as poor weather in Western Europe.
However, it is upgrading its organic profit growth for 2017 to between 7% and 8%, which was previously expected to be ‘mid-single-digit percentage growth’. The group didn’t publish net income for the three-month period.
In Western Europe, net sales declined by 4%. Markets such as Bulgaria, Serbia and Italy achieved positive volume growth, while ‘most other markets saw declining volumes due to the poor weather’.
Meanwhile in Eastern Europe, net sales declined by 2% in the third quarter. Volume grew in Kazakhstan and Belarus, were flat in Ukraine and declined in Russia.
The Russian government has upped efforts to discourage heavy drinking in recent months. The sale of so-called PET bottles (plastic bottles larger than 1.5 litres) have been banned.
However, Carlsberg’s business in Asia posted positive results, with net revenue up 7% with a ‘strong performance’ of its premium portfolio.
By brand, Tuborg volumes grew by 5%, with growth achieved in China in addition to continued positive results from the launch last year in Vietnam and Laos.
The Carlsberg brand grew by 1%, reflecting positive growth rates in markets such as Poland and China, offset by a difficult situation in India and decline of Carlsberg green label in the UK.
Grimbergen and 1664 Blanc delivered volume growth of 7% and 42% respectively. In total, craft and speciality grew by 34% for the quarter. The company’s alcohol-free brews gained momentum and delivered 14% volume growth in Western Europe.
Speaking of the results, Carlsberg CEO Cees ’t Hart said: “Funding the Journey is progressing very well and we feel confident about delivering benefits of around DKK 2 billion ($313 million). Consequently, we’re able to adjust our earnings outlook upwards.
“In the third quarter, our premiumisation efforts continued to deliver a solid price/mix development, while volumes, as expected, were impacted by the PET downsizing in Russia, tough comparables in Eastern Europe and poor weather in Western Europe.”
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