Carlsberg fourth quarter operating profit drops, CEO retires
Danish brewer Carlsberg reported a 22 percent fall in fourth-quarter operating profit on Wednesday as sales in its key Russian market slumped, and said its chief executive would retire in June.
Carlsberg's operating profit before special items dropped to 1.79 billion crowns ($275.9 million) from 2.3 billion crowns a year earlier, missing analysts' expectation for 1.93 billion crowns in a Reuters poll.
For 2015, the world's fourth largest brewer, expects operating profit to grow organically by mid- to high-single-digit percentages but its eastern European operations will continue to weigh on the group, it said.
"While we expect our Western Europe and Asia regions to continue their positive development, the expected GDP decline and currency devaluation in Russia and Ukraine will put significant pressure on the Group's overall performance," Carlsberg said.
Chief Executive Jorgen Buhl Rasmussen will retire from the firm on June 15, to be replaced by Royal FrieslandCampina chief Cees 't Hart.
Carlsberg said in January that it had decided to close down two of its 10 breweries in Russia due to the country's economic downturn and tough market regulation that have dented sales.
The Russian beer market that has shrunk more than 30 percent since 2008 under pressure from regulations aimed at curbing alcoholism, including a law banning the sale of alcohol from street kiosks.
The firm's sales grew by 39 percent to 3.0 billion crowns in Asia in the fourth quarter, but fell by 32 percent to 2.7 billion crowns in Eastern Europe mainly due to a downturn in Russia sales.
In its largest, and most stable, West European region sales fell 4 percent to 8.6 billion.
Carlsberg's large global competitors, Anheuser-Busch Inbev , SABMiller and Heineken, are not as dependent on the Russian market as the Danish brewer.