Carlsberg reports “good start to the year” thanks to Asia region

Carlsberg has recorded volume growth of 12.8% in the first quarter, as a strong performance by China offsets the on-trade plummet in Western Europe.

The Danish brewer witnessed a strong start to the year in its Asia and Central & Eastern Europe businesses, while Western Europe remained significantly impacted by lockdowns and restrictions across the region.

Carlsberg’s revenue grew organically by 3.8% to DKK 13 billion ($2.11 billion), driven by organic volume growth of 11.5% as recovery was strong in many markets.

The Chinese market in particular performed very well, with more than 50% organic volume growth – driven by Chinese New Year activities, premium brands and partly supported by easy comparables as Q1 2020 was heavily impacted by the outbreak.

Excluding China, the rest of Asia reported organic volume growth of 5%. Carlsberg saw a good start to the year in India and Vietnam, while markets such as Nepal and Malaysia were impacted by lockdowns and restrictions.

In Western Europe, volumes fell organically by 5.8% and revenue dropped 14.9%. Markets such as Norway and Poland continued last year’s growth trajectory, but markets with high on-trade exposure declined, particularly in the UK and Switzerland.

The company’s Central & Eastern Europe unit was less impacted due to relatively small on-trade exposure, recording an 8.9% increase in organic volume and 3.1% revenue growth. Russia in particular achieved strong mid-teens organic volume growth.

Once again, Carlsberg’s alcohol-free brews and craft and specialty category performed well, with organic volume growth of 24% and 13%, respectively.  

Tuborg volume went up 26%, mainly due to China, India and the Turkish licence market. Carlsberg beer fell 4% as strong growth in Asia was offset by the Western Europe market. Meanwhile, 1664 Blanc’s volumes increased 33% thanks to growth in China and across Central and Eastern Europe and Somersby went up 31% broadly based across all three regions.

While uncertainty remains high, in the light of Carlsberg’s “good start to the year”, the company has raised the bottom end of its earnings guidane for 2021 –  expecting operating profit within the range of 5-10%, compared to the previous 3-10%.

Carlsberg CEO, Cees ’t Hart, said: “With Covid-19 continuing to be a challenge in many of our markets, our geographical exposure showed its strength, as strong volume growth in several markets across all three regions more than offset challenging circumstances in other markets.”