Carlsberg has highlighted a drop in the Russian rouble as one of the key factors behind a fall in its third quarter profits.
The Danish brewer reported a 4.8 per cent decline in net profit for the three months to the end of September reaching 2.1 billion kroner (£222 million). Carlsberg said in its trading statement that it had faced some "market challenges in Eastern Europe" but was still pleased to have delivered organic earnings growth and increased cash flow.
Earlier in the year, Carlsberg was among a number of companies that had noted their concern about the ongoing tensions between Russia and Ukraine. Over the summer months, Carlsberg saw its beer volumes in Russia drop between six and seven per cent while in Ukraine this figure had fallen by ten per cent.
A decline in the value of the rouble has once again impacted Carlsberg's operations. The Russian currency lost seven per cent against the euro in the third quarter and over a quarter of its value since the start of 2014. Carlsberg does a lot of trade in Russia and the fall in the nation's currency had resulted in the Danish brewer losing 15 per cent of revenues in the region.
Jørgen Buhl Rasmussen, Carlsberg's chief executive, said: “The man on the street (in Russia) isn't very optimistic about the future, and we don't expect the climate to ease in the near term or in the early part of 2015."
While Carlsberg has seen revenues and profit drop in Russia, the company is set to continue its investment plans in the country. The company's Russian market share stood at 37.9 per cent for the quarter, which included TV advertising and sponsoring local football teams.
Shares in Carlsberg grew by 2.7 per cent following the trading update.
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