SHAH ALAM: Carlsberg Brewery Malaysia Bhd, which posted a 5.6% jump in its earnings for the six-month ended June 30, 2019 (1H’19), expects to maintain its current momentum for its FY19 performance given a record FY18.
Managing director Ted Akiskalos (pix) is anticipating a softer market in 2H’19 due to the macro economic uncertainty that translates into muted consumer sentiment.
“In this soft market, we believe that by executing priorities and consistently driving product innovation, we’ll be able to sustain the momentum that we have so far,” he told a media and analyst briefing after announcing its 1H19 financial results here yesterday.
For the rest of the year, the group does not expect significant fluctuation in raw material prices.
Akiskalos sees the premium segment contribution becoming more sizeable going forward after observing a shift in consumer preference to premium brands. The premium segment saw a 22% volume growth in 1H19 versus 1H18, including Kronenbourg 1664 Blanc (+51%), Somersby (+8%), Connor’s Stout Porter (+45%) and Asahi (+8%).
“Consumers are increasingly looking for value over volume and they are willing to pay for experiences that are differentiating from the past,” said Akiskalos, adding that it sees this trend continuing.
It is also evaluating options for alcohol-free beverages as part of Carlsberg’s global agenda.
For the second quarter (Q2) ended June 30, 2019, Carlsberg’s net profit grew 2.1% to RM65.26 million from RM63.91 million a year ago, driven by top line growth and higher profits in both the Malaysia and Singapore operations.
Its revenue increased 15.7% to RM480.52 million compared with RM415.4 million in the previous year.
Excluding the impact from SST, its revenue would have grown 11.2%.
For 1H’19, its net profit expanded 5.6% to RM152.86 million from RM144.73 million a year ago, while revenue jumped 18.3% to RM1.14 billion from RM963.92 million.
Carlsberg declared a Q2 interim dividend of 16.1 sen per share. Together with the 21.5 sen declared in Q1, the 1H’19 interim dividends totalled 37.6 sen per share, which represents a payout ratio of 75.1% of the group’s net profit for 1H’19.
It is confident that its focus in executing the SAIL’22 strategy will enable the group to continue delivering growth in Malaysia and Singapore.
The group is also hopeful that the government will not impose any further excise duty increases for Budget 2020, which will lead to more influx of contraband beers and losses to government tax revenue.