Denmark & Russia: Carlsberg drops annual guidance, to stop selling its Carlsberg brand in Russia

Carlsberg stock traded 5% lower in Copenhagen on March 10 after the brewer dropped its annual guidance, owing to uncertainty in Russia, one of its largest markets, Bloomberg reported.

It said it will stop selling its flagship brand Carlsberg in the country while its Russian unit, Baltika Breweries, will be run as a separate business.

Russia and Ukraine accounted for around 13% of the Group’s revenue in 2021.

Carlsberg said the ongoing conflict between the two countries “will negatively impact the Group’s financial results for 2022” and warned there could be write-downs on assets while it undertakes a full review of its business in Russia.

The company said the markets outside Russia and Ukraine are currently witnessing a limited business impact but the indirect impact from rising commodity prices, including energy, will hurt the cost of goods and logistics.

Carlsberg has a huge presence in both Russia and Ukraine. With 8,300 employees, Baltika is one of the largest consumer goods companies in Russia and the market leader in beer with about 27% share, according to information available on the Carlsberg website.

Carlsberg joins rival Heineken and hundreds of other companies that have either quit or curtailed their operations in the Russian market. Heineken said on March 9 it has stopped the production and sale of its own-brand beer in Russia. Its stock traded 1.8% lower in Amsterdam trading.