By DALJIT DHESI
daljit@thestar.com.my
It locks in up to 90% of raw material prices for this year
SHAH ALAM: Carlsberg Brewery Malaysia Bhd expects to maintain its margins this year despite high commodity prices as it has locked in up to 90% of its raw material prices for the year. Its managing director Soren Ravn said in the next three months the company would have to decide on raw material prices for next year and this would entail, among others, hedging at least 50% of raw material prices.
“Raw material prices like malt and aluminium for beer cans have increased by 30% from a year ago. We do not expect this rise to immediately impact our earnings this year as we have already locked in raw material prices. “If prices were to persist next year, it will still not have much impact on our earnings due to hedging,'' he said at a press conference in conjunction with the relaunch of its Carlsberg brand. This initiative occurred simultaneously across more than 140 markets in which the Carlsberg group operates.
Soren Ravn at the relaunch of Carlsberg’s global brand.
Carlsberg, currently among the top five brands in the country, is banking on organic growth and would focus on revenue generation rather than volume, Ravn said. Asked whether the relaunch of its brand would drive sales, he said, without specifying numbers, that it would judging from the launch of its earlier products. “When we launched the smaller version bottle of our beer two years ago it managed to uplift our sales by 20% to date. Hopefully, with a bigger bottle, we hope to rake in more sales,” he said.
Going forward, he said the acquisition of Carlsberg Singapore Ptd Ltd and subsidiary Luen Heng F&B Sdn Bhd would provide growth. After more than two years in the making, the group finally unveiled its major global relaunch brand with a new slogan “That Calls for a Carlsberg”. He said for the first time, Carlsberg would share the same core visual identity of the brand worldwide, adding that it would give the brand the same look and feel in terms of packaging and bottles across all markets.
According to Ravn, Malaysia is an important contributor to Carlsberg worldwide's revenue besides Denmark and Europe. For the financial year ended Dec 31, 2010, the group with its strengthened brand portfolio and the successful integration of Carlsberg Singapore achieved RM1.4bil in revenue for the year ended 31 Dec 31, 2010, a 31% growth over the previous year. Its profit after tax stood at RM134.1mil with growth in profitability from both the Malaysian segment and the full year's inclusion of the consolidated results of Carlsberg Singapore.
