Carlsberg CEO sees more focus on Asia after Russian exit

CARLSBERG, the Danish brewer, reported a strong gain in first-quarter revenue and said it plans to focus on growth in Asia after deciding to exit the Russian market.

Sales rose 24 per cent on an organic basis to 14.9 billion kroner (S$2.9 billion) last quarter, the company said Thursday (Apr 28). Analysts expected growth of 13 per cent. The stock gained as much as 3.1 per cent in Copenhagen. 

The revenue increase came after the Danish brewer raised prices to shift higher raw material prices onto consumers and people returned to pubs, bars and restaurants across Europe. But chief executive officer Cees ’t Hart pointed to Asia as the next growth source for the company as it moves ahead with plans to exit the Russian market.

“We have a very good plan where we focus on countries like China, Vietnam and India,” he said in an interview with Bloomberg Television. He also highlighted growth opportunities in some European countries and specific product segments like alcohol-free beer. 

Carlsberg reduced its earnings guidance last week and said it’s facing a US$1.4 billion writedown due to its Russian exit. Heineken, Carlsberg’s main competitor, has reported beer sales that beat estimates and hasn’t changed its profit outlook.

Carlsberg’s new forecast outlines that operating profit could decline by as much as 5 per cent or gain up to 2 per cent. 

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The brewer has said the divestment of its business in Russia may take up to 12 months and the assets there are being reassessed. Carlsberg is “in the middle of the process” of finding buyers for the Russian assets, according to ’t Hart.

Carlsberg plans to buy back up to 1 billion kroner worth of shares. BLOOMBERG