World: Heineken and Carlsberg expected to report growth in beer sales this year

Beer producers Heineken and Carlsberg are expected to report growth in beer sales for 2023 when both release a first-quarter update next month, analysts have revealed.

Danish brewer Carlsberg is predicted to see volume growth of 0.3%, while revenue is due to rise by 7.4% in the year so far, Deutsche Bank indicated.

The German bank believes growth will be influenced by a 7.1% increase in pricing and customers switching to the company’s more expensive brands.

Guidance for operating profits in 2023 was placed between -5% and 5% in the business's most recent results.

However, the investment bank is confident that the brewer will tighten guidance to -2% and 5% when it provides a first-quarter update on 27 April.

“We expect that Carlsberg will be able to deliver growth at the top of this range and increase our predictions to 5.2% from 4.1% previously,” said Deutsche Bank.

Carlsberg shares are up close to 13% in the year-to-date, having opened at DKr1,034 (£123).

Deutsche Bank targets a share price of DKr1,110 and reiterates a ‘buy’ rating.

In the Netherlands, Heineken has had a more turbulent beginning to 2023, but analysts remain confident it will report volume growth ahead of first quarter results due 19 April.

Over shipments in Vietnam and lack of currency in Nigeria means that volumes in these areas will be weaker than expected, according to US bank Citigroup.

Improved performances in Europe – due to “assertive pricing”– and increased volume in the Americas, might be able to offset some of the first-quarter issues.

Analysts at the US bank are cutting sales growth estimates for the first quarter by 2% and expect the consensus to fall as well.

“Despite the challenging start to the year, ongoing cost efficiencies mean we expect Heineken to reiterate its mid to high single-digit growth targets for underlying profits in 2023,” said Citigroup.

The investment bank still sees Heineken, which is edging closer to a €100 share price, as a core pick in the beverage market for 2023 and sticks with a ‘buy’ rating.

Citigroup claims the company’s price-to-earnings ratio is 5% lower than Carlsberg's and that the discount is “unwarranted” offering a “risk/reward that is skewed to the upside”.

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