Carlsberg Gains as Growth in Craft Beer Unit Lifts Profit

(Bloomberg) --

Carlsberg A/S got a further boost from craft beers such as London Fields Brewery in the first half, with a 17% sales gain from its specialty division fueling profit growth that’s lifting the shares.

Net profit rose 25% in the period, the Danish company said Thursday, after it raised its full-year outlook last week. The shares rose as much as 4.9% in Copenhagen, bringing the increase this year to more than 40%.

“All our key growth priorities –- craft & specialties, alcohol-free brews and Asia -– delivered good growth,” the company said in a statement.

The latest update shows that Chief Executive Officer Cees ’t Hart’s focus on boosting sales is paying off. Along with craft brews, high-end brands such as Grimbergen and Jacobsen ales are driving growth, after several years in which the CEO concentrated on cutting costs.

The strength of the first half suggests a further upgrade is possible later in the year, Jefferies analyst Edward Mundy said in a note. The brewer needs no growth in the latter six months to meet its guidance, and Carlsberg pointed to “solid start” to the third quarter.

Carlsberg and industry giant Anheuser-Busch InBev NV are outperforming rival Heineken NV, which lagged behind in the most recent period.

Carlsberg is also starting the second stage of a previously announced share buyback, planning to repurchase 2 billion kroner ($300 million) of its stock.

©2019 Bloomberg L.P.