Malaysia. Carlsberg to raise prices slightly

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Carlsberg Brewery Malaysia Bhd is planning to slightly increase the prices of its beer products in May.

Managing director Soren Ravn said the company would increase prices by an average of less than 3% across its beer product range due to rising raw material and operating costs.

“The increase in prices is not huge, and is in line with inflation, and this reflects our higher input costs. In the next three to six months, we will appropriately hedge raw material prices,” Ravn said after the company’s AGM yesterday.

He said the continued rise in prices of raw materials like malt and aluminium for beer cans might have an impact on the company’s earnings in the fourth quarter. “Also, there is a level of uncertainty about 2012. If you look at the situation now, next year looks kind of scary.”

This year, key growth drivers for Carlsberg in Malaysia are its imported premium/super premium beer brands such as Hoegaarden and Asahi and Kronenbourg 1664, as well as its global brand relaunch.

For the first time, Carlsberg will share the same core visual identity worldwide, with the same look and feel in terms of packaging and bottles across more than 140 markets it operates.

Ravn said the company aimed to secure a 20% market share of the premium/super premium beer segment this year.

“The premium beer segment is growing faster than the cheaper beer segment. This is where we see the opportunities,” said Ravn, who also pointed out that the company’s brewery was nearing its maximum production capacity.

“We have a road map for the next three to five years, to unlock the bottlenecks in the brewery in order to increase capacity without the need for heavy capital expenditure. So, at least we can grow our capacity at the same pace as our volume,” he said.

Ravn expects a maximum growth of 5% for the beer market in terms of volume this year.

“There was a decline in beer consumption in 2009 while we saw a 10% growth in volume for the beer market last year. I think we will see a low single-digit growth in 2011 as 2010 was a sort of catch-up period for the beer market.”