Carlsberg to cost more next month

"the impact of the price increase on Carlsberg’s earnings, if any, would be marginal."

"We don’t foresee earnings being bumped up"

==> It seem earnings would be stagnant/marginal increase.

Asked about prospects, Ravn said the company had a “good feeling” about this year. “We think the industry will grow by about 2% after contracting last year.”

For Carlsberg, it would ride on the synergies it would continue to create with Carlsberg Singapore Pte Ltd as well as further develop new products to capture higher sales,

==> The "good feeling" worth a growth rate of 2%. Huh... finally, new products is the right way to do to capture higher sales. Keep up the good work. !!

Managing director says company playing catch-up with increase in raw material prices

KUALA LUMPUR: Carlsberg Brewery Malaysia Bhd will increase the prices of its beer and stout products by an average of about 3% next month, says managing director Soren Ravn.

“We are trying to play catch-up with the rise (in price) of raw materials such as malt and hops which have increased 10% on average over the past five years,” he told reporters after a shareholders’ meeting yesterday.

Ravn said the company had last year increased prices only “slightly”, taking into consideration the economic downturn of 2008 and its flow-through effect on consumers last year.

It is understood that the average annual increase on Carlsberg products over the past five years is about 2%.

We are trying to play catch-up with the price rise says CARLSBERG BREWERY MALAYSIA BHD MD SOREN RAVN ON THE 3% INCREASE NEXT MONTH

The price increase would be industry wide, according to Ravn.

OSK Research Sdn Bhd analyst Vincent Lim, who covers the company, said the impact of the price increase on Carlsberg’s earnings, if any, would be marginal.

“They have been doing this historically, it’s just simply to pass on costs to consumers. We don’t foresee earnings being bumped up,” he said.

Asked about prospects, Ravn said the company had a “good feeling” about this year. “We think the industry will grow by about 2% after contracting last year.”

For Carlsberg, it would ride on the synergies it would continue to create with Carlsberg Singapore Pte Ltd as well as further develop new products to capture higher sales, Ravn said.

Carlsberg Malaysia, which is a 51%-owned unit of Denmark-based Carlberg AS, acquired Carlsberg Singapore for RM370mil in the fourth quarter last year.

Carlsberg Malaysia has a profit guarantee of S$24mil from the acquisition for the financial years ending Dec 31, 2009 (FY09) and FY10.

Chairman Datuk Lim Say Chong said the company, which enjoys the lion share of the local beer market, was expected to pay out 50% to 70% of distributable profits this financial year.

The group distributed 69% of its FY09 net profit to shareholders.

For FY09, Carlsberg reported a net profit of RM75.9mil against RM76.1mil in FY08.

Among its most popular brands are Carlsberg Green, Skol, Royal Stout, Carlsberg Gold and Carlsberg Special Brew, which accounted for 95% of the company’s total sales last year.