Carlsberg Reports Continued Healthy Organic Development

In the first six months of 2008, Carlsberg achieved progress in underlying operations in every geographical segment. Total organic growth in net revenue was 7% (10% in local currencies).

11/08/08 Carlsberg has said that total organic beer volume growth of 6% was achieved in the first six months of 2008. This was driven by continued growth despite tough comparables in Eastern Europe, and in Asia, and a flat overall performance in Northern and Western Europe. Total group beer volume growth of 24% was achieved.

In second quarter organic beer volumes grew by 13% in Eastern Europe; including volume growth in Russia of 6.5% vs market growth of 2.8%.

In the first six months of 2008, Carlsberg achieved progress in underlying operations in every geographical segment. Total organic growth in net revenue was 7% (10% in local currencies) and in operating profit it was 22% (in local currencies 26%).

Second quarter had organic growth in net revenue of 7% (in local currencies 10%; in Northern and Western Europe +3%, Eastern Europe +30%, and Asia +20%). Total organic growth in operating profit in the brewing activities in the second quarter was 16% (in local currencies 19%).

Significant improvement of product mix, especially in Russia, where consumer preference for premium beer continues to grow.

Price increases are compensating for rising raw material prices and leading to higher gross earnings. Despite higher selling prices Carlsberg increased its market share in most markets.

Integration of the activities acquired from S&N is running to plan and contributing to realisation of the expected synergies of approximately DKK 1.3bn three years after the acquisition.

Organic growth in net revenue of approximately 10% is expected for 2008. Combined with net revenue from acquired activities, this is expected to result in total net revenue for the current year of DKK 62-63bn. In line with previous announcements, operating profit is expected to grow organically to around DKK 5.9bn (approximately +12%), including a contribution of approximately DKK 300m from other activities. Overall, operating profit for the current year is expected to be in excess of DKK 8.1bn, while net profit is expected to top DKK 3.0bn.

Based on the new geographical segmentation, the new financial target is to increase the operating margins in the medium term for Northern and Western Europe to 14-16% and for Eastern Europe to 23-25%.