07 November 2003 21:00
City Round-Up: BBH warning in spite of profit rise
BALTIC Beverages Holding, the Russian joint venture between Edinburgh-based brewer Scottish & Newcastle and
Denmark's Carlsberg, has increased its market share and seen a rise in operating profits.
In third-quarter results, the group, which makes Russian market leader Baltika beer, saw its Russian market share
increase 1.5 per cent to 33.1 per cent.
Operating profits increased by three per cent to GBP 74.6 million, when expressed in euro terms.
However, the brewer warned that the Russian beer market was not expected to grow quite as fast as previously
predicted for the year as a whole.
BBH operates across six countries in Eastern Europe. Market penetration also improved in the Ukraine, where capacity
constraints eased in the third quarter, allowing the company to recover market share.
For the third quarter, BBH's share, including Baltika imports, was 21.4 per cent, 1.1 per cent higher than the
previous year.
A new brewery in due to open in the Ukranian capital Kiev next year, which the company hopes will add momentum to its
current good performance.
A high level of competition in the Baltic region led to a market share loss of 0.7 per cent to 45.3 per cent.
However, over the year the market share has remained level at 44.8 per cent.
Net sales for the third quarter grew 16 per cent on volume growth of eight per cent - the effect of a more stable
pricing environment than in the first six months of the year.
Baltika is now the number two beer by volume in Europe behind Heineken, after overtaking Amstel of the
Netherlands.
The firm hopes to further deflate Dutch brewing pride by displacing Heineken, Amstel's sister brand, as the
Continent's best-selling beer by volume sold.
In May, BBH continued its expansion in Kazakhstan, acquiring its second brewery in the country. The GBP 18.2m deal
for the privately owned Ak-Nar brewery saw it take over a plant with a capacity of 60 million litres.
[UKIR [UK & Ireland Intelligence Wire]] |
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