WRAPUP 1-Brewers look to Asia, new products to counter sagging European sales
* Heineken downbeat on full-year prospects
* Sees little Europe, U.S. pick-up
* Carlsberg cuts Russia market outlook
* Heineken shares down almost 4 pct, among weakest in Europe
By Philip Blenkinsop and Teis Jensen
BRUSSELS/COPENHAGEN, Aug 21 (Reuters) - Growth in emerging markets could not rescue Dutch brewer Heineken and rival Carlsberg on Wednesday from poor spring weather and grinding economic recession in much of Europe.
But both forecast strong demand in Asia would ensure full-year earnings match or go beyond last year's levels and Heineken said it would push new products such as Radler, a mix of lager and lemon juice, to draw back European drinkers.
Heineken, the brewer with the greatest sales in Europe, said austerity-driven beer excise hikes, such as in France, and subdued consumer sentiment in Europe and the United States were hitting demand, with little improvement seen.
Chief Executive Jean-Francois van Boxmeer said trading conditions would most probably remain challenging after a first half he acknowledged was below the group's expectations.
"Certainly for Europe and North America we don't see any substantial trading condition change for fast-moving consumer goods and our industry in particular," he said.
Carlsberg CEO Jorgen Buhl Rasmussen echoed that view for Western Europe at least, saying the region would be challenging in 2014.
Heineken's Van Boxmeer said that brewers had suffered from a slowdown of growth in traditionally high-growth countries, such as Brazil and in Africa.
"I would not make the projection that the growth rates we were used to before would reignite."
However, Asian demand was strong.
The world's top brewers are relying on emerging markets for growth given a prolonged squeeze on incomes in austerity-hit Europe and limited U.S. expansion, but such growth has been uneven, with weakness this year in Brazil and Nigeria.
NO SUNSHINE FROM RUSSIA
Heineken, the world's third largest brewer, reported first-half operating profit above the average in a Reuters poll, but earnings per share below market forecasts.
World number four Carlsberg, which is market leader in Russia, slightly lagged market forecasts for operating profit and revenue in its second quarter after strong Asian growth failed to compensate for sluggish Europe.
The Danish brewer kept its 2013 guidance but cut its forecast for the Russian beer market growth to a mid-single-digit percentage point decline from a previous forecast of a flat market after a first half hit by slower economic growth and a ban on beer sales from kiosks.
Morten Imsgard, analyst at Sydbank, said Carlsberg was gaining market share in Russia, but the market was in poor shape. "The process of getting consumers into supermarkets from kiosks has proven more difficult than Carlsberg had expected. 2013 will not be a sunshine story in Russia," he said.
Heineken shares dropped as much as 4 percent and were among the weakest performers in the FTSEurofirst 300 index of leading European stocks.
Carlsberg shares were broadly flat at 1100 GMT.
Heineken has raised the target of its latest cost-saving plan by 100 million euros to 625 million euros ($840 million) and has benefited from warmer weather in Europe from July. Van Boxmeer said a good summer could not make up for a poor spring.
Dirk Van Vlaanderen, beverage analyst at Jefferies, said Carlsberg's outlook was realistic and in line with the current market consensus, but Heineken's outlook of flat net profit compared with market expectations of a small rise.
"They are not cheap, trading at 17 times price to earnings next year, the same as AB InBev but not with the same growth profile," he said.
World number two SABMiller also suffered from a cold, damp spring, while AB InBev saw volumes decline but improved margins in both the United States and Brazil.
- Malaysia plane search straddles continent as police focus on crew |
- Crimeans vote over 90 percent to quit Ukraine for Russia |
- Crimea asks to join Russia after Soviet-style vote |
- Stocks near one-month low as western sanctions on Russia loom |
- Ukraine, Russia agree Crimea truce until March 21-Ukraine minister