Dmitry Nekrasov’s Philosophy — on the Past, Present and Future of Ukrainian Brewing IndustryA meeting with Dmitry Nekrasov always turns into a training course: “Introduction to brewing business“. We are talking to a clever “playing trainer“ a person that can be called a godfather of the Ukrainian craft. He has a dozen of successful projects to his name. Dmitry told us about craft beer in Ukraine, on market cycles, on specifity of operating in retail and HoReCa, on union of Ukrainian brewers and certainly, how a brewery of his own, First Dnipro Brewery is doing.
The market of import beer in Russia: review and databasesThe market of import beer is rapidly growing and changing. But while in the past years it was growing due to brands variety, in 2019 major and affordable brands from TOP-10 were developing actively. It seems that the fact of a brand origin from far abroad counties, even if it is not well known but has moderate price and good distribution provides for million liters of sales in the territory of Russia. Among distributors AB InBev Efes was far behind, yet the role of Baltika and suppliers of the second row got more important. The boom of German brands was followed by stagnation of import from other traditional regions (and Belarus) instead the supplies from Mexico, Lithuania and Asian countries grew considerably.
Russia: Positions of Brewing CompaniesThe review contains an analysis of interim performance of brewers in the first half of 2019. There are rather dynamic changes behind a modest industry growth. Baltika is again experiencing a stage of volumes and market share slid due to competition with AB InBev Efes. Because of the price competition and presence expansion in the modern trade company #2. has come close to the leading position. At the same time sales of Heineken Russia have continued growing which makes the premium part of the portfolio heavier. The market premiumization trend had been also confirmed by import brands. MBC and Zavod Trekhsosenskiy have been the most successful among federal market players. The market share of independent regional brewers and Ochakovo have continued falling as they are being squeezed out by the market leaders at their competitive fields.
Ukrainian beer market 2019: companies and brandsIn 2019 beer production and market have been still fluctuating about zero point. However, the past season was successful for brewers judging by the sales profitability. The price mix has improved due to rapid general market premiumization, as well as its particular aspect, the growth of import beer sales. By the season end AB InBev Efes improved its positions considerably. It turned out that consumers had not forgot Efes brands that had to leave the market, but started to recover rapidly. Against the stagnating market that meant sales decline of other companies, in the first place Carlsberg Group that most of all beneficiated from Efes exiting the market. PPB turned out to be stable to branding activity of its competitor and Obolon kept the same volumes and at the moment it is the absolute leader of the economy segment. The share growth of independent producers took place thanks to leading craft breweries, that so far do not have a big market weight, but they are rapidly gaining it.
Brewing industry in Kazakhstan 2019During the first half of 2019, the majority of Kazakh brewers made their contribution into positive dynamics. Yet it was companies of the lower division, not the two transnational leaders that raised their production and sales. The shares of draft beer and aluminum can which is rapidly squeezing glass bottle out of the market, have been growing. The price segmentation has remained stable despite the substantial rise of retail prices and fluctuations of brand market shares, while the borders between segments have become blurred. The main events in the industry have been: the announced revision of the beer excise policy, launch of BeerKhan brand in the strong beer segment, and most important – purchasing assets of Shymkentbeer by Arasan.
The trend of complication of Russian beer market is going on and in several directions at the same time. The range has got wider, the import and small segments are growing, namely craft beer, alcohol-free beer and special flavor beer. At the same time, all ex-mega brands and light lagers by Russian brewers are experiencing a decline of their shares. AB InBev Efes, Heineken, MBC and Pivzavod Trekhsosenskiy have exceeded the market, Carlsberg was developing slower than the market and Ochakovo as well as some other mid-sized breweries have been cutting down their volumes. To a big extent brewers’ performance was connected to their ability to reach agreement with networks, sacrifice their margin and enter new markets. Craft brewers are facing a serious danger of producers’ registration introduction – de facto licensing. ...
Carlsberg’s turnaround plan in Russia bears fruit
Like other big brewers, Carlsberg is relying on emerging markets and price rises to offset sluggish demand in western Europe and stiff competition in mature markets.
But its leading position in Russia has been hampered by a government drive aimed at curbing alcohol abuse, with measures taken including excise tax increases and a ban on advertising in all media, including the internet.
The world's fourth-largest brewer said on Wednesday its share of Russia's beer market, where its brands include top-seller Baltika and Tuborg, rose to 38.9 percent in the third quarter from 37.9 percent in April-June.
Its Russian beer sales rose about two percent, contrasting with a 2-3 percent fall in the market overall.
"We are seeing clear signs that we are on the right track in Russia," chief executive Jorgen Buhl Rasmussen told analysts.
A year ago, Carlsberg replaced the head of Russian division Baltika Breweries to address slowing sales.
It has increased its focus on best-selling brands, cutting out those which have not sold well, and taken a more targeted approach to marketing in a country which is seeing a shift from small, local stores to large supermarkets.
"The market share data for the third quarter is an indication that these initiatives are starting to bear fruit," Rasmussen said.
A BATTLE FOR GIANTS
With the improvement in the third quarter, Carlsberg has increased its market share in Russia for three consecutive quarters following a string of declines.
Rivals including Anadolu Efes (AEFES.IS), which is owned by world No. 2 SABMiller (SAB.L), and Dutch group Heineken (HEIN.AS) lost market share in the quarter, while Anheuser-Busch InBev (ABI.BR) held its ground, Carlsberg said.
Carlsberg shares were up 3.8 percent at 537.5 Danish crowns by 1250 GMT, one of the biggest rises by a European blue-chip stock .FTEU3.
"The result is particularly positive in Russia," said Sydbank analyst Morten Imsgard. "I see this as a sign that they are in control of the Russian business."
Group operating profit rose almost 10 percent to 3.6 billion crowns ($618 million) in the quarter, compared with a forecast for 3.72 billion crowns in a Reuters poll. Sales grew to 18.8 billion crowns against a forecast 18.6 billion.
Eastern Europe and Asian sales cushioned continued sluggish demand in western Europe, where sales contributed 55 percent of total group revenue while eastern Europe made up 32 percent.
"The positive is that they grew in Russia in the third quarter," Alm Brand analyst Stig Nymann said.
Carlsberg kept its 2012 outlook for operating profit before one-off items to be at the same level as in 2011 when it reached 9.82 billion crowns.
($1 = 5.8276 Danish crowns) (Editing by Dan Lalor and Mark Potter)
13 Ноя. 2012