Malaysia: Carlsberg Brewery Malaysia reports lower net profit for Q1

Carlsberg Brewery Malaysia Bhd (Carlsberg Malaysia) is hopeful that the lifting of total travel restrictions globally will boost consumer demand, The Star reported on May 9.

The company said this is as Malaysia and Singapore anticipate an increase in inbound travellers.

“The end of the Prosperity Tax 2022 will also positively impact the net profit,” the company said in a filing with Bursa Malaysia.

For its first quarter ended March 31, 2023, Carlsberg Malaysia reported a lower net profit of RM85.04mil, compared with RM91.59mil in the previous corresponding period, while revenue in the first quarter rose to RM660.20mil, compared with RM653.85mil a year earlier.

Basic earnings per share stood at 27.81 sen versus 29.96 sen previously.

Carlsberg Malaysia said year-on-year revenue in the first quarter increased by 1%, due to the effect of price adjustment offsetting the impact of lower volume following the early timing of Chinese New Year (CNY) this year.

“Despite higher revenue, profit from operations declined by 4.2% to RM109mil with higher marketing spend.

“The group registered a lower share of profit in its associated company, Lion Brewery (Ceylon) PLC by 52.4% to RM3.2mil for the quarter compared to the previous year’s corresponding quarter, due to the sharp devaluation of Sri Lanka Rupee against the ringgit since March 2022.”

The group announced a first interim dividend of 21 sen per share for the first quarter ended March 31.

Meanwhile, in a statement, Carlsberg Malaysia managing director Stefano Clini said the company’s first quarter results were impacted by the timing of CNY.

He explained that this resulted in a shorter sales period within the quarter and lower consumer consumption due to increasing concerns on the elevated cost of living, amid sluggish economic growth forecasts in Malaysia and Singapore.

“We also observed a shift in consumer spending from domestic consumption to international travel as the latter has become more accessible and beer consumption has normalised after the surge of economic activity experienced after the reopening in 2022.”

Looking ahead, Clini said Carlsberg Malaysia is mindful that the global economy remains highly uncertain, adding that inflationary pressures are expected to rise.

“The disruption to global supply chains and the escalating commodity prices will continue to pose challenges.

“Embarking on our SAIL’27 corporate strategy, the group will continue to strengthen our core beers, step up on premiumisation and continue to build alcohol-free brews as an alternative for consumers who prefer non-alcoholic beverages.”

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