Carlsberg growth held back by Russian woes

Danish brewer Carlsberg on Tuesday reported quarterly results slightly above expectations as dwindling sales in Russia were partly offset by higher beer volumes in Asia and western Europe.

Carlsberg growth held back by Russian woes
While Russia continues to pull Carlsberg down, things are looking up in Asia and western Europe. Photo: Ilya Naymushin
Carlsberg's revenue in eastern Europe tumbled 30 percent to 1.735 billion kroner (233 million euros, $261 million), mostly as the result of the lower Russian ruble.
“Due to the difficult macro environment in the region, the Russian beer market declined by an estimated nine percent and the Ukrainian beer market by an estimated 14 percent,” the company said in a statement.
In January Carlsberg closed two of its breweries in Russia — where its Baltika brand has a 38 percent market share — cutting its production capacity in the country by 15 percent.
Organically, meaning acquisitions and mergers are not included, the group's beer volumes fell one percent  as they gained five percent in western Europe and four percent in Asia.
Earnings before interest, tax and special items rose 46 percent from a year ago to 661 million kroner, which was higher than the 562 million kroner consensus of analysts surveyed by news agency Ritzau.
The net loss for the period widened to 90 million kroner from 67 million, as revenue grew four percent to 13.471 billion, also slightly ahead of expectations.
The group reiterated that for the full year it expects operating profit to grow organically “by mid to high single digit percentages.”
Shares in Carlsberg were 4.9 percent lower in midday trading on the Copenhagen bourse, where the main index was 1.7 percent lower.

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Is Carlsberg about to release a paper beer bottle?

Two prototypes and new partnerships have brought Danish brewing giant Carlsberg a step closer to releasing a paper beer bottle.

Is Carlsberg about to release a paper beer bottle?
Is the glass Carlsberg bottle living on borrowed time? Photo: Kristian Juul Pedersen/Ritzau Scanpix

Carlsberg said in a press release that it was close to selling beer in paper bottles, in part to the partnership.

Having worked on development of sustainable packaging since 2015, the company is scheduled to present two prototype paper bottles in Copenhagen on Friday.

“Although we’ve not yet reached our goal, the two prototypes are a significant step on the way to achieving our ultimate ambition, which is to bring this groundbreaking technology onto the market,” deputy director of Group Development at Carlsberg, Myriam Shingleton, said via the press statement.

A ‘paper bottle union’ between Carlsberg, The Paper Bottle Company (Paboco) and three other global companies – Coca-Cola, L'Oréal and The Absolut Company – is driving the development, according to the Danish brewery.

Paboco said that the partnership with the high-profile brands would strengthen work to create sustainable packaging.

“We are working across different retail sectors, sharing risk and are together in our vision to make the paper bottle reality which would fundamentally change the sector forever,” Paboco CEO Gittan Schiöld said.

Both prototypes are constructed primarily of sustainably grown wooden fibres and have internal coatings which enable them to contain beer.

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