Carlsberg expects a challenging biz year despite net profit jumping 88.2% in 4Q21


CARLSBERG Brewery Malaysia Bhd foresees a challenging business year on the back of escalating commodity prices, cost pressure and the resurgence of higher Omicron variants of Covid-19. 

MD Stefano Clini said the brewer committed to delivering the highest quality and innovation, as well as driving premiumisation across its product portfolio that suits the needs and lifestyle of beer lovers. 

“We’re going to continue with our strategy which is based on innovation and memorisation, coupled with very strong cost control, which I think we pride ourselves on being very good. 

“With that, we are also excited to introduce new products in the coming months and also to launch promotions to help speed up the recovery in both on-and off-trade businesses”, Clini said. 

The group net profit jumped to RM71.4 million for the fourth quarter ended Dec 31, 2021 (4Q21), compared to the previous year at RM37.9 million, with revenue rising to RM542.3 million due to the Malaysian operation registering higher sales. 

“However, in Singapore, the sales revenue decreased by 6.2% to RM147.6 million due to the stricter restrictions during the 4Q21 on dining-in capacity hampering the on-trade channel. 

“Consumer sentiment also improved in the reporting quarter with more re-opening of On-Trade outlets for dine-in and with inter-state travelling allowed and the gradual easing of pandemic restrictions,” he said 

He added that its Singapore operations grew both in volume and value, and recorded premium brands growth in off-trade as well as in the e-commerce channel, as the overall lockdown duration there was shorter than in the previous year. 

Guided by the corporate strategy SAIL’22, the group defended its bottom line by implementing stringent cost controls through discount optimisation, lower sales and administration expenses, coupled with better premium mix leveraging on the launch of Connor’s Stout 

Porter in can and Carlsberg Smooth Draught packaging innovations, and the new variant offerings of Somersby Watermelon Cider and 1664 Rosé in March and December respectively for the domestic market. 

In addition, the group has doubled its e-commerce sales for both Malaysia and Singapore. 

The Singapore entity reported a 6.3% increase in revenue at RM561.1 million for financial year 2021 (FY21) despite the increased restrictions in dine-in capacity and re-imposition of suspension of entertainment outlets operations. 

Profit from operations, however, fell by 10.2% to RM58 million due to the higher cost of sourcing products from other Carlsberg markets 

when the Malaysian brewery was suspended, coupled with the absence of Covid-19 Job Support Scheme Grant by the Singaporean government that was received in 2020. 

The group’s Sri Lankan-based associate company Lion Brewery (Ceylon) plc registered a growth in share of profits of RM15.2 million in FY21 versus RM14.9 million in the previous year’s corresponding period due to the reopening of the economy in the country. For 4Q21, its share of profit was 55.8% higher at RM5.6 million versus RM3.6 million in 4Q20. 

The group’s earnings per share (EPS) for FY21 rose 23.9% to 65.7 sen and $Q21 EPS was 23.4 sen, an 88.2% increase compared to a year ago.