jwesth @jwesth: "𝘾𝙖𝙧𝙡𝙨𝙗𝙚𝙧𝙜'𝙨 𝙛𝙞𝙧𝙨𝙩-𝙝𝙖𝙡𝙛 𝙧𝙚𝙨𝙪𝙡𝙩𝙨 𝙘𝙤𝙪𝙡𝙙 𝙥𝙪𝙩..."

United Kingdom

Edited

𝘾𝙖𝙧𝙡𝙨𝙗𝙚𝙧𝙜'𝙨 𝙛𝙞𝙧𝙨𝙩-𝙝𝙖𝙡𝙛 𝙧𝙚𝙨𝙪𝙡𝙩𝙨 𝙘𝙤𝙪𝙡𝙙 𝙥𝙪𝙩 𝙖𝙣 𝙚𝙣𝙙 𝙩𝙤 𝙡𝙖𝙨𝙩 𝙢𝙤𝙣𝙩𝙝𝙨' 𝙨𝙝𝙖𝙧𝙚 𝙥𝙧𝙞𝙘𝙚 𝙙𝙚𝙘𝙡𝙞𝙣𝙚 🍺 $CARLB.CO (Carlsberg A/S Class B) results for the year's first half have been eagerly awaited. This comes after the share price has taken a beating over the past few months, falling by around 13% since June. 🤔 Investors have been concerned about Carlsberg's acquisition of major British soft drinks producer Britvic, leading them to question whether it was a value-creating acquisition given its size and price. And most recently, competitor Heineken reported challenges in the Chinese market, leading investors to fear that Carlsberg is facing something similar, with the Chinese market accounting for around 24% of Carlsberg's sales volume. 📊 The Danish brewing giant's results are proving less strong than investors had hoped. Sales of beer and other beverages in the first half of the year were 65.7 million hectolitres, while revenue was 38.8 billion kr. and operating profit was 6.3 billion kr., all slightly below expectations. Carlsberg explains that they have been challenged by bad weather and a weaker consumer in some Asian markets. 🔍 However, it's only the details that don't add up, and the result is better than we could have feared in the wake of Heineken's results. Despite weakening consumer sentiment in the Chinese market, Carlsberg can still report growth in both sales volume and revenue for the Asian region. 💪 Carlsberg also managed to increase their gross margin to 46.3% from last year's 44.7%. It is positive that Carlsberg is on track to regain a stronger gross margin, which has been under pressure from rising raw material and energy prices over the past few years. Back in 2019, they had a gross margin of 49%, and the brewery has previously announced that they want to restore the margin to previous levels with an increased focus on procurement and supply chain optimisation. Today's results show that they have taken the first steps in the right direction. It will be a big win for Carlsberg's bottom line if they can bring margins back to previous levels. 👨‍💼 Carlsberg can also report the first upward revision of 2024 guidance, with management now expecting operating profit to grow by +4-6% compared to the original 1-5%. This is a solid upward revision of the lower end of the guidance. But the original expectation also seemed conservative in a year characterised by big beer-drinking events like EURO 2024 and the Olympics. Most investors have likely factored in the upper end of the range anyway, which is why the announcement does not necessarily result in solid share price increases. 😮‍💨 Today's result is a relief for investors. It can create a some calm around the share and put a natural stop to the falling price development we have seen over the past few months. $HEIA.NV (Heineken) $HEIO.NV (Heineken Holding NV) $ABI.BR (Anheuser Busch InBev) $RBREW.CO (Royal Unibrew A/S) $BUD (Anheuser-Busch Inbev Sa-ADR) $DGE.L (Diageo) $RI.PA (Pernod-Ricard SA)

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CARLB.CO

Carlsberg A/S Class B