CARLSBERG increased its profit growth outlook for the year as cost controls helped the Danish brewer to offset weaker consumer demand.
Organic operating profit will rise between 4 per cent and 6 per cent this year, up from previous guidance of between 1 per cent and 5 per cent, the Tuborg maker said on Tuesday (Aug 13).
Tighter cost controls helped to counter a smaller-than-expected 1.4 per cent rise in volumes in the first half of the year, which lagged analyst estimates. The performance was dragged down by Western Europe, which experienced bad weather and sluggish demand.
Consumer companies are grappling with shoppers reaching their spending limits and cutting back, after a period of high inflation left them feeling the pinch.
Carlsberg chief executive officer Jacob Aarup-Andersen has vowed to spend more on marketing to entice stretched consumers back. Aarup-Andersen has also pledged to keep raising prices to offset higher costs and lower volumes, as consumers drink less premium beer or switch to cheaper brands.
Carlsberg’s chief is looking to diversify the brewer’s offerings as customers increasingly turn to alcohol-free beer, soft drinks and alternatives such as hard seltzer.
Carlsberg’s chief is looking to diversify away from alcoholic beer as sales slow. Customers are instead drinking alcohol-free beer, soft drinks and alternatives such as hard seltzer. As part of the shift, Carlsberg agreed in July to buy UK soft drinks producer Britvic for £3.3 billion (S$5.6 billion). BLOOMBERG
