Carlsberg’s 1Q net profit down 9%, as sales fell amid MCO 2.0

Carlsberg’s 1Q net profit down 9%, as sales fell amid MCO 2.0
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KUALA LUMPUR (May 18): Carlsberg Brewery Malaysia Bhd's net profit for the first quarter ended Mar 31, 2021 (1QFY21) fell 8.91% to RM66.46 million from RM72.96 million in the previous year’s corresponding quarter, as it recorded lower sales in Malaysia during the period, which was partially mitigated by higher sales in Singapore and lower operational costs.

Quarterly revenue fell 9.81% to RM532 million from RM589.87 million, its stock exchange filing today showed, following the reimposition of the Movement Control Order or MCO 2.0 from Jan 13 to Feb 18 in several states in Malaysia during the reporting quarter, which impacted on-trade consumption and caused weaker Chinese New Year sales.

"Comparatively, in 2020, with MCO 1.0 imposed from March 18, 2020, the group managed to sell significant stock ahead of the lockdown, hence the impact on its Q1FY20 performance was
relatively minimal," it noted. The group's quarterly earnings per share fell to 21.73 sen from 23.86 sen previously. No dividend was declared for the quarter.

On a quarter-on-quarter basis (q-o-q), however, the group’s net profit rose 75.1% from RM37.95 million 4QFY20, as revenue rose 12.6% from RM472.54 million, supported by sales recovery in both Malaysia and Singapore.

“Our Q1FY21 performance, although a significant improvement q-o-q, was impacted by (MCO 2.0) in Malaysia. As in 2020, our top priorities remain the health and well-being of our employees, supporting our customers to the best of our ability and safeguarding the financial health of the business,” said Carlsberg Managing Director Stefano Clini in a statement.   

He also noted that the business outlook has deteriorated following the latest lockdowns under current circumstances, and that Carlsberg's board will continue to suspend its review of a dividend policy for 2021 until later in the year, when hopefully these uncertainties will ease and the conditions become clearer.

"Uncertainty remains high. This is evident with the resurgence of Covid-19 cases that led to re-imposition of lockdowns in both Malaysia and Singapore with tightened safety measures, no dining-in for on-trade sector, and work-from-home arrangements resuming for non-essential employees. While we are pleased with the progress of Covid-19 vaccination programmes in both countries, we are cautious over the uncertainties relating to the pandemic, further government actions, and other macroeconomic developments,” he said.

On that note, he urged the Malaysian government to expedite Covid-19 immunisation plan for the manufacturing and related services to help flatten the curve and support the government’s goals in achieving herd immunity.

He also hopes that the Malaysian authorities will continue to extend support to the beer industry in combating contraband.

Carlsberg shares closed 40 sen or 1.85% higher at RM22 apiece today, giving it a market capitalisation of RM6.74 billion. 

Tan Choe Choe