Carlsberg Raises 2018 Profit Forecast as Revenue Surprises

(Bloomberg) -- Carlsberg AS raised its forecast for 2018 earnings growth to as much as 11 percent as the Danish Brewer said third-quarter revenues were higher than expected.

Key Insights

• Warm weather in Europe during the second leg of the summer drove demand for Carlsberg’s beers.
• The forecast is an endorsement of the cost-cut strategy of Chief Executive Officer Cees ’t Hart over the past three years in the face of stiffer competition following the merger of Anheuser-Busch InBev NV and SABMiller Plc. AB InBev reports tomorrow.
• Carlsberg had already increased its profit forecast in August, predicting that its earnings would rise by a high-single-digit percentage over the course of the year due to wringing out costs, up from a previous forecast of mid-single-digit growth

Market Reaction

Carlsberg shares jumped as much as 5.3 percent in Copenhagen, and traded 1.7 percent higher as of 2:22 p.m. local time. The stock has been little changed this year, compared with a 10 percent decline by the OMX Copenhagen 25 Index. Heineken is down 0.3 percent after reporting its weakest Asian beer volume growth in three years.

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