(Bloomberg) -- Carlsberg A/S raised its 2022 earnings forecast after better beer sales in Asia and Europe outweighed higher material costs.
The Danish brewer said it expects “high single-digit-percentage organic growth” in 2022 operating profit, according to a statement on Monday. Carlsberg, which makes the Tuborg brand, had previously forecast between a 5% decline and 2% growth.
The upgraded guidance shows consumers are still drinking beer despite higher prices now that bars and restaurants have re-opened after pandemic lockdowns.
Carlsberg's units have “delivered better-than-expected business performance, particularly as a consequence of strong on-trade recovery in our European markets and strong results in many Asian markets,” the company said. “This has more than offset the increasing commodity and energy cost pressure.”
Carlsberg's improved forecast “exceeds market expectations in our view and should be well received,” Jefferies analysts including Edward Mundy said in a report.
The stock rose as much as 3.4% following the announcement and ended the day 1.5% higher in Copenhagen.
The company, which put its Russian business up for sale earlier this year, said it has now resumed operations at all three of its production facilities in Ukraine after an initial suspension. Its full-year results will include any contribution from Ukraine.
Chief Executive Officer Cees 't Hart, in a May Bloomberg Television interview, pointed to Asia and markets such as India and Vietnam as the next growth engines for Carlsberg. The CEO also cited potential growth in some European countries and segments like alcohol-free beer.
Carlsberg is due to publish second-quarter earnings on Aug. 17.
(Updates with industry context in third paragraph and analyst comment in fifth)
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