Carlsberg sees no impact from ringgit strengthening

SHAH ALAM: Carlsberg Brewery Malaysia Bhd does not anticipate any impact upon its business from the strengthening ringgit, should this trend sustain moving forward.

The group noted any gains in reduced cost ledgers is likely to be counter balanced by reduced repatriation from its overseas presence through exports and direct markets through its subsidiaries in Singapore.

Thus, the impact is neutral to the company’s bottomline, said its chief financial officer Anthony Yong.

“The strengthening helps us in our input costs, while we have exports in the Malaysia unit along with our investments in Singapore.

“As such, there is a cancellation in net impact of these currency developments to the company,” Yong said at a briefing of Carlsberg’s financial year 2025 ended Dec 31 (FY25).

Its managing director Stefano Clini said he welcomes the stability of the group’s finances in the face of any changes in the local currency given its naturally hedged position.

“We are not a financial institution, we do not want to make or lose money from currency movements. As such we are less exposed from the changes in the ringgit,” Clini said.

Commenting on its business in Singapore, Clini said consumer spending in the island-state is ‘more subdued’ compared to Malaysia.

“The decline is bigger in Singapore than in Malaysia. But people may ask, it is one of the richest countries in the world, how can this be?

“We are seeing significantly lesser consumers going out to drink in Singapore – and we have seen a record number of outlet closures.

“We are talking about thousands of closures and this is affecting us a little bit. The consumer sentiment in Singapore is very negative, which impacts us,” Clini said.

He sounded conservative on the coming FY26 given the challenges on several fronts to the group while the timing of the World Cup 2026 may not work in its favour although gains might be present for the coming Chinese New Year (CNY) celebrations.

“They may not want to wake up early in the morning to drink beer. Due to the timing difference between the United States, Mexico, Canada and here we are not that sure (of the gains),” he said.

“Also while the economy in Malaysia is doing well, what counts for us is consumer sentiment, which is still jittery.

“It has not improved and there is still a lot of anxiety out there, people seem to be concerned about the future and aren’t spending much. Since the Covid pandemic, there has been a cycle of macro events globally that has impacted consumer sentiment.

“Though, the Visit Malaysia Year 2026, and investments in new technology may help but we have not seen it yet.

“Consumer sentiment is still way below the peak we saw in 2019 just before Covid struck,” Clini added.

Despite challenges and lower sales, the group managed to achieve a record net profit in FY25 on cost management initiatives and one off gains.

Carlsberg Malaysia’s FY25 revenue declined by 4.9% year-on-year (y-o-y) to RM2.3bil while its net profit grew by 11.4% y-o-y to RM375.6mil.

The group said lower revenue was due to the unfavourable CNY timing during the year and subdued consumer sentiment in both Malaysia and Singapore.

The higher earnings, on the other hand, were due to price increases, value management initiatives, continued focus on cost optimisation and a one-off trade offer adjustments from the Singapore operations.

For the fourth quarter ended Dec 31, its revenue declined by 10.8% y-o-y to RM523.6mil mainly driven by a later 2026 CNY timing and lower distributor stocks at the end of the year, while its net profit grew by 22% y-o-y to RM96.2mil.

The higher earnings were primarily supported by value management initiatives and reduced operating cost compared to the same quarter last year, it said.

Carlsberg’s board recommended a final dividend of 43 sen per share, which will bring the total dividends declared for FY25 to 111 sen per share.

“Amidst the economic uncertainty as well as evolving consumption behaviour across our markets, we remain committed to staying agile and responsive to market dynamics and competition in both Malaysia and Singapore, ensuring that we continue to deliver value to our consumers and stakeholders,” said Clini.