CARLSBERG BREWERY MALAYSIA BERHAD

Business Summary

Carlsberg Brewery Malaysia Berhad is an alcoholic beverage brewer, with strong market presence in Asia and Europe. It is one of the 2 breweries operating and listed on the main board of Bursa Malaysia

Update 09.05.2019

Dividends (5/5): ⭐ ⭐ ⭐ ⭐ ⭐  

Value (2/5): ⭐ ⭐ 

Financials (5/5): ⭐ ⭐ ⭐ ⭐ ⭐ 

Growth (4/5): ⭐ ⭐ ⭐ ⭐ 

Business (4/5): ⭐ ⭐ ⭐ ⭐ 

Reference: (i) MyKayaPlus Metrics Definition (ii) MyKayaPlus Metric Evaluation Scale


Brands & Portfolio

  • Carlsberg
  • Carlsberg Smooth Draught
  • Carlsberg Special Brew
  • Kronenbourg 1664 Blanc
  • Asahi Super Dry
  • Somersby
  • Connor’s Stout Porter draught
  • Brooklyn Brewery
  • Corona Extra
  • SKOL
  • Royal Stout
  • Jolly Shandy
  • Nutrimalt

2018 Geographical Statistics

 

Countries & Region Operating Revenue Profit Before Tax
Malaysia 71% 73%
Singapore 29% 27%
Others 0% 0%

Although operating and making a presence in both Malaysia and Singapore, Malaysia contributes about two-thirds of Carlsberg Bhd’s operating revenue and profits. 

Apart from Malaysia and Singapore, Carlsberg Bhd also has a stake in a Sri Lanka brewery Lion Brewery. As of 2018, the contribution of Lion Brewery is still small compared to the total operating revenue of Carlsberg Bhd.

 

Financial Performance

 

Source: CARLSBERG BHD ANNUAL REPORT

Carlsberg Bhd has been locking in increased turnover year over year. Profits have also been increasing steadily in tandem with revenue growth. Return on Equity has also trended up significantly. A high ROE denotes that a company is able to generate more profits on top of the small equities contributed by shareholders.

 

Balance Sheet 

YearAssets (RM’000)Liabilities (RM’000)Equities (RM’000)Current RatioDebt to Equity (%)
2018682,523501,526180,9970.8441.44%
2017651,425338,959299,0181.265.37%
2016661,522331,475321,6891.3010.13%
2015661,765319,177335,5751.349.20%
2014661,548330,427312,1551.3915.77%

As of 2018, Carlsberg Bhd has assets worth RM683 million, with Liabilities of RM502 million and Equities at RM181 million. Gearing ratio is reasonable at 41%. To check the liquidity of the company, we look at the current ratio, which measures a company’s ability to use its current assets to pay off any current liabilities. As of latest 2018, Carlsberg Bhd’s current ratio is at 0.84

Operating Cash Flow & Dividend Paid Out

Source: CARLSBERG BHD ANNUAL REPORT

Not only Carlsberg Bhd registered more sales. The cash generated from their main operating business, which is the manufacturing and selling of alcoholic beverages has also seen an increased influx of cash generation capabilities.

As profits soared higher, so did the dividend paid out. From here we can ascertain Carlsberg Bhd is a company that rewards shareholders with dividends that tag along with the company’s profit.

 

Future Growth

 

Carlsberg Bhd launched a strategic road map dubbed the SAIL’22, launched in Mar’2016. The initiative is divided into 4 categories – Strengthen Core, Position for Growth, supported by a Winning Culture, with the objective of Delivering Value to Shareholders

Now the 3rd year under the SAIL’22 initiative, Carlsberg Bhd has shown the company is on track, with share prices increased by more than 100%, dividends per share increased by roughly RM0.20 per share. Looking back at our data, we can’t help but also notice that revenue, profit, ROE all took a sharp rise ever since SAIL’22 commenced.  

Carlsberg Bhd has been generating consistent growth in revenue and profits. Being one of the only two breweries that operate and manufacture alcoholic beverages in Malaysia, they enjoy a very superior business advantage moat as imported beers are usually much more expensive due to the high import tariffs Malaysia levies upon. Carlsberg Bhd manages to grow its revenue by increasing local sales and also exports to Asian countries like Singapore and Hong Kong

Price

MyKayaPlus Verdict

The brewery business is considered a niche part of the Fast Moving Consumer Goods (FMCG). Carlsberg Bhd not only manufactures quality products, but they also put in a lot of initiatives in cost-cutting measures to deliver more profits. Coupled with the fact that tariffs are steep for imported beers, Carlsberg would only need to outperform its competitor HEIM in the alcoholic beverage sphere. 

With excellent historical results and dividends to reward its shareholders, plus it is still growing the business, Carlsberg Bhd will definitely be a good stock to keep an eye on

 

DISCLAIMER
The information available in this article/report/analysis is for sharing and education purposes only. This is neither a recommendation to purchase or sell any of the shares, securities or other instruments mentioned; nor can it be treated as professional advice to buy, sell or take a position in any shares, securities or other instruments. If you need specific investment advice, please consult the relevant professional investment advice and/or for study or research only.
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