Danish brewer Carlsberg has announced plans to reach its stepped-up growth ambitions through 2027, including higher spending in key countries such as China.
The world's third-largest brewer and maker of brands such as Kronenbourg 1664 also reported forecast-beating full-year revenue, though its expectations for 2024 operating profit growth were behind many analysts' expectations.
Earlier, Carlsberg raised its 2027 targets for revenue and operating profit growth after new CEO Jacob Aarup-Andersen reviewed his predecessor's strategy, but gave few details about how it would reach its more ambitious goals.
Aarup-Andersen told journalists that during a challenging past few years with the COVID-19 pandemic and war in Ukraine, Carlsberg had been defensive. But now it could accelerate its long-term plans.
"We see clear opportunities to inject investments and accelerate our long-term growth," he said.
Those investments include more spending on marketing for its portfolio of more expensive beers, pushing further into other categories like ciders and seltzers and doubling down on its expansion in Asia, in particular China, its largest market.
Investments And Outlook
In 2024 alone, Carlsberg expects to increase sales and marketing investments by over 10%, with most of that spending dedicated to China and Vietnam, premium brands and digital projects.
However, in 2024, it expects organic operating profit growth of between 1% and 5% in 2024, well below some analysts' expectations.
Laurence Whyatt, analyst at Barclays, said the company has a reputation for setting more conservative guidance at the start of the year and upgrading it later, but its current guidance suggested Carlsberg could struggle to reach his estimates.
"Maybe we're being too optimistic," he said of his forecast for operating profit growth of around 12%.
Carlsberg's 2027 growth goals were more ambitious, he continued, but appeared to rest on as yet unclear factors such as a rebound in the Chinese economy.
Carlsberg said while the consumer environment in China remained subdued, it expected to grow volumes there through market share expansion.
The company reported a 4.7% rise in 2023 revenue to DKK 73.59 billion(€9.9 billion), narrowly topping the DKK 73.31 billion (€9.8 billion) expected by analysts, LSEG data showed.