KUALA LUMPUR (Feb 21): Carlsberg Brewery Malaysia Bhd is now focusing on how to address the effect of the Covid-19 outbreak on its beer sales, which will take a big hit if the outbreak lasts till June, according to its managing director Stefano Clini.

The impact will be especially felt on the off-trade side like grocery and retail stores, said Clini. But at this juncture, it is too early to ascertain the full impact of the outbreak on its business.

"We are giving this a lot of focus and attention. We are concerned, but it is too early for us to say whether it is going to be material for us.

"We do see some impact in sales for the time being, especially in entertainment outlets. We were told that some outlets' traffic were down by 10%, some down 20%. How much is that going to translate into beer sales...that's the key question," he told a media briefing today.

Clini explained that the group's business is a reflection of two factors: How well is Carlsberg doing in winning the hearts of its consumers with its product execution, and the overall consumer sentiment.

"I can say we are doing a great job in winning the hearts of our consumers but I cannot say that we have control over the overall market consumer sentiment," he said.

"We are convinced we are going to have a good year but we are getting ready in case things take a turn for the worse. As they say, hope for the best, be ready for the worst," Clini added.

Even without the coronavirus outbreak, Clini said the first quarter of 2020 (1QFY20) will be impacted by the trade loading in last December, in view of the timing of Chinese New Year this year.

"We have a cautious view on 2020's outlook in response to the lower Gross Domestic Product (GDP) growth forecast for Malaysia and Singapore at 4.5% and 0.9%, respectively," he said, adding the company is also concerned about the outbreak's impact on the macroeconomy and overall consumer sentiment.

Carlsberg today reported a slight year-on-year increase in its net profit for 4QFY19 at RM68.99 million, up 2.3% from RM67.45 million contributed by increasing premiumisation and higher trade loading in December 2019.

Quarterly revenue rose 9.2% y-o-y to RM573.92 million from RM525.65 million, primarily due to higher sales. Its Malaysian operation, it noted, sustained its growth momentum through volume growth across all major product segments driven by continuous marketing investments.

For the full financial year 2019 (FY19), Carlsberg recorded a 5% increase in net profit to RM291.02 million compared with RM277.15 million in the previous year, as revenue grew 13.8% to RM2.257 billion from RM1.982 billion.

It declared a final single-tier dividend of 23.6 sen per share and a special single-tier dividend of 4.8 sen per share for FY19, making the total payable for the proposed dividend to be 28.4 sen per share or RM86.8 million.

Shares of Carlsberg closed up 90 sen or 2.37% today at RM38.94 for a market capitalisation of RM11.91 billion.