Political upheaval hurting beer sales in Eastern Europe
As the political and economic atmosphere continues to deteriorate in Eastern Europe, companies doing business there can expect a downturn in profits. At least that is what is going on with the iconic Danish beer maker Carlsberg.
The company issued a preliminary financial statement on Thursday stating that, “due to recent macro events the consumer sentiment and the outlook for some of the economies in Eastern Europe are becoming increasingly challenging and uncertain.”
The company fears, but expects, that sales will collapse during the second half of 2014 due to a slashing of the stocking of its product by Russian distributors.
Jorgen Buhl Rasmussen, chief executive of Carlsberg said that he was “satisfied” with sales for the first half of the year, but worried about the second half which is yet to come.
“Unfortunately, we believe the Eastern European beer markets will be impacted further as consumers are facing increased challenges and this will impact the Group’s profits negatively this year,” said Rasmussen.
Rasmussen added that the company will have to make some “tough decisions” in order to keep the company above water.
