It’s a first: Asia is bigger profit contributor for Carlsberg than Russia
How times are changing. Carlsberg made more profit last year in Asia than in eastern Europe for the first time. Eastern Europe – predominantly Russia – accounted for just 19 percent of operating profits last year, down from a peak of 52 percent in 2009, while Asia jumped to 28 per cent.
“The strong Asian result is a milestone for Carlsberg. It is an important inflection point towards the future,” said Cees ’t Hart, the brewer’s CEO, who took over from Jørgen Buhl Rasmussen in 2015.
Russia has long been a headache for Carlsberg since it took control of Russia’s major brewer Baltika in 2008 by buying out Scottish & Newcastle.
Revenues in eastern Europe have collapsed from DKK 19.7 billion in 2011 to DKK 11billion last year while operating profits have fallen by two-thirds since 2009 to DKK 1.9 billion in 2015.
Mr Hart acknowledged that the rise of Asia could be said to be “by default” due to market woes in Russia. But, ahead of his big strategy update scheduled for March 2016, he refused to turn his back on Russia, arguing that Baltika continued to provide good returns in roubles.
In recent years, Carlsberg has sought to expand in Asia, buying up Chinese brewers such as Chongqing in 2014. But, after years of strong growth, the Chinese market seems to have entered into decline too with volumes dropping 7.3 percent in the January to September period last year.
