Carlsberg Expects Full-Year Profit Drop on Weaker Russia Sales

Carlsberg A/S, the world’s fourth-biggest brewer, reported second-quarter profit that missed analysts’ estimates and said it expects 2015 organic operating profit to drop as western Europe and Russia weighed on sales.

Earnings before interest, taxes and one-time items were 2.92 billion Danish kroner ($432 million), the Copenhagen-based company said in a statement Wednesday. Analysts on average had estimated profit of 3.23 billion kroner. Sales fell 3 percent on an organic basis, which excludes currency and acquisition effects.

As the biggest brewer in Russia, where the beer market dropped 9 percent in the quarter, Carlsberg has been hit by a slump in the country’s currency amid falling oil prices. The beermaker has reduced production there to counter weaker demand. Carlsberg stock has traded in tandem with the ruble, which fell to a six-month low against the dollar on Monday.

“The first half of 2015 has been challenging for the group with weaker than expected results in Western Europe and market decline in Eastern Europe,” Chief Executive Officer Cees ’t Hart said in the statement. “For the full year, we therefore do not expect that the strong Asian performance will be enough to offset the weaker than expected results in Western Europe and the challenging market conditions in Eastern Europe.” Hart, the former CEO of Dutch dairy cooperative FrieslandCampina, replaced Joergen Buhl Rasmussen at the helm in June.

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