UK: Carlsberg CEO can’t rule out further job cuts in the UK

The chief executive of Carlsberg has said he cannot rule out further jobs cuts as the beer giant pushes ahead with a sweeping efficiency drive, potentially leaving British jobs hanging in the balance, the Evening Express reported on August 20.

The Danish brewer last year revealed it had axed more than 2,000 white-collar jobs as part of the restructure and would outsource beer distribution in the UK, impacting around 900 jobs by March 2018.

It will leave Carlsberg UK with about 950 staff – chiefly across its brewery and head office in Northampton and its customer contact centre in Leeds.

Carlsberg chief executive Cees ‘t Hart told the Press Association that additional job cuts at the firm have not been taken off the table.

“You can never of course say that no cuts will be done in the future, so there are no promises on that one. However, we don’t have any other plans than we had announced more or less a year ago.”

But Mr ‘t Hart said Carlsberg was still “in the execution mode” of its turnaround plan, “so we’re not done yet.”

“But everybody who is involved in that, and is concerned, has been informed.”

Carlsberg has its efficiency drive to thank for helping deliver a 20% jump in half-year pre-tax profit to 3.8 billion Danish krona (£4.6 billion), despite a smaller 2% rise in half-year revenues to 31.8 billion Danish krona (£38.9 billion).

Consumer appetite for more expensive drinks helped compensate for a drop in volumes in the half year to June 30, particularly in the UK where Carlsberg suffered a 7% drop in volumes due to “tough” comparables following strong demand during the Euro 2016 football championship.

Carlsberg says its focus on “premium” brands and craft brews in Britain helped offset the impact.

In a bid to broaden its foothold in the craft market, the firm’s UK arm snapped up Hackney’s London Fields Brewery in July.

It was a part of a joint venture with US brewer Brooklyn, which Mr t’ Hart said will “make sure that this kind of spirit of craft brewers remain intact.”

“The London Fields Brewery was particularly attractive to us because we felt we could make a positive difference to the business in terms of our portfolio (and) tapping into some of the trends,” Mr ‘t Hart said.

While Carlsberg has increased craft and speciality drinks volumes by 25%, the chief executive assured that the company was not on a local brewer takeover mission.

“We don’t have plans to certainly get into a kind of chain of acquisitions, or small acquisitions, as London Fields is,” he said.

Meanwhile, major consolidation has taken place at the top of the industry, with Anheuser-Busch InBev’s £79 billion mammoth takeover of SABMiller having completed last autumn.

But Mr ‘t Hart said the mega-deal has had little impact on Carlsberg, aside from Russia, where a mix of challenges resulted in a drop in market share and volume in the six months to June 30.

“We are in countries, of course, where either ABI or SAB are strong, but we were not in countries where the combination of them, except then for Russia, moved the needle in terms of market share.”

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