Carlsberg Soars After Lifting Outlook on Craft Beer Growth

(Bloomberg) -- Carlsberg A/S surged the most in a decade after the Danish brewer raised its full-year earnings outlook, helped by demand for its pricier craft beers.

Following an initial focus on cutting costs, Chief Executive Officer Cees ’t Hart is switching gears to drive more revenue from more exclusive beer brands such as Grimbergen. The shares rose as much as 12% Thursday in Copenhagen, their biggest intraday gain since 2009. Budweiser maker Anheuser-Busch InBev NV gained as much as 2.3%.

Read this: ‘More Dependable’ Carlsberg Gaining Analyst Favor

As demand for mass-market lagers slows in the developed world, Carlsberg has sought more growth from its specialty and craft division that includes London Fields brews, acquired two years ago, and Jacobsen ales. Investments in countries such as Cambodia have also brought more control over sales and marketing in emerging markets.

The strategy is working: the company said it now sees organic operating profit rising at a high single-digit percentage rate, after previously forecasting growth in the mid-single-digits. Carlsberg joins AB InBev in reporting a positive performance, in contrast to rival Heineken NV, which lagged behind in the most recent period.

What Bloomberg Intelligence Says

“The strategy focusing on premium and craft brews continues to deliver improved volume and earnings, despite Europe’s poor early summer weather.”

-- Duncan Fox, consumer products analyst

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Carlsberg has increased its profit forecast at least once in each year since 2016, the year after the start of ‘t Hart’s tenure. The company said it will report first-half results on Aug. 15.

To contact the reporter on this story: Thomas Buckley in London at tbuckley25@bloomberg.net

To contact the editors responsible for this story: Eric Pfanner at epfanner1@bloomberg.net, John Lauerman

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