Tuborg Boosts Carlsberg in Asia as Rivals Jockey for Position
(Bloomberg) -- Carlsberg A/S raised its full-year profit guidance amid soaring demand for Tuborg beer in Asia.
Sales volume for the label, one of the top foreign brews in China, rose 8 percent in the first half, the Danish company said Thursday. That gave Carlsberg a lift in one of its key markets as larger rival Heineken NV seeks an edge through its purchase of a $3.1 billion stake in the country’s top beer maker, China Resources Beer Holdings Co.
The shares rose as much as 4.1 percent, the most in more than two years.
The Heineken deal will boost demand for premium beer in China, Carlsberg Chief Executive Officer Cees ’t Hart said on a call, referring to it as a “strong competitive move.” Net revenue from China grew 17 percent in the first half, led by the international brands Tuborg and 1664 as well as the company’s namesake lager.
Carlsberg is also wringing costs out of its business to weather a slowdown in beer demand in more established markets. As a result, earnings before interest, taxes and one-time items will rise by a high-single-digit percentage over the course of the year, the Copenhagen-based brewer said in a statement, up from a previous forecast of mid-single-digit growth.
Carlsberg is on track to cut more than 2.3 billion kroner ($350 million) of costs as it defends its turf against an enlarged and more profitable rival following the combination of Anheuser-Busch InBev NV and SABMiller Plc.