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Q3 2022 Trading Statement


Company Announcement No 47/2022 – 26 October 2022

Q3 2022 Trading Statement

Resilient volumes and solid pricing drive top-line growth

Statement by Royal Unibrew’s CEO, Lars Jensen: “It has been a challenging quarter with a continued high pressure on our cost base and also the changing behavior of our consumers has started to have an impact on our business towards the end of the quarter. The underlying business momentum continues to be strong, and I am proud that we are able to drive an organic revenue growth of 12% in the quarter. This result is a testimony of our strong brand portfolio and resilient categories and evidenced by the favorable market share development for our key brands.”


“The changed outlook for the full-year, which we communicated last week, is driven by three different challenges impacting the business towards the end and after the quarter, and the underlying root cause remains the inflationary environment. We are experiencing an environment where consumers to a greater extent use the discount stores in their daily shopping, and in the marketplace we are experiencing a more competitive landscape. On top of this, we have seen a one-off destocking at our wholesalers in Italy, as they work to optimize their cash management in uncertain times with high inflation and higher interest rates. Despite of this, our brands continue to grow market shares. We are working hard on having the right products, in the right packaging sizes, at the right prices, in the right location and at the right time for our consumers to mitigate the negative impact on our business,” Lars Jensen continues.

“Our growth formula with a focus on key growth categories has proven to work. We are delivering a solid profit outlook, which is around 9% higher than what we realized pre-COVID in 2019. We are convinced that to secure future growth, even in times of high uncertainty, we need to continue to invest behind our key brands, with a continued focus on ROIC on these investments,” says Lars Jensen.

Key highlights:

  • Organic volume growth of 2% (Q1-Q3 2022: 2%)

  • Positive price/mix from pricing initiatives

  • Organic revenue growth of 12% (Q1-Q3 2022: 14%)

  • Continued commercial investments behind our key brands

  • Favorable market share development for key brands

  •       EBIT margin negatively impacted by raw material price increases, higher freight costs, higher energy prices and margin dilutive M&A

Financial highlights Q3-2022
Volume for Q3 2022 increased by 11% compared to Q3 2021 and amounted to 3.8 million hectoliters. Organic volume growth was 2% with the difference explained by acquisitions. For Q1-Q3, volume is up by 10%, corresponding to 2% organic growth. In Q3, net revenue increased by 35% (organic: 12%) and amounted to DKK 3,296 million. Net revenue growth in Q1-Q3 was 37% (organic: 14%) compared to the same period in 2021 and amounted to DKK 8,669 million.

Earnings before interest and tax (EBIT) for Q3 was DKK 106 million lower than in 2021 and amounted to DKK 490 million (2021: DKK 596 million). In Q1-Q3, EBIT declined by DKK 136 million compared to 2021 and amounted to DKK 1,210 million (Q1-Q3 2020: DKK 1,346 million).

EBIT went down by DKK 119 million organically in Q3. The decline is primarily caused by an increase in marketing costs and continued investments in organizational capabilities and capacities totaling around DKK 50 million, around DKK 30 million higher logistic costs and the time-lag between increases in COGS and sales price increases. The increase in marketing costs were planned and committed before the war in Ukraine began, and the logistic cost increase, which is stemming from the International division is difficult to push on to customers, as we are up against local competition.

The time-lag between COGS inflation and sales price increases, in combination with a negative mix effect, impacted gross profit negatively by around DKK 40 million. Northern Europe explains a minor part of the negative mix effect, which is mainly driven by Western Europe because our CSD portfolio here has grown faster than our beer portfolio. That said, our super-premium beer offering has grown faster than the market (year-to-date approx. 10%) measured by sales out numbers, whereas destocking, which took place towards the end of Q3, also drove a negative mix effect.

The reported EBIT margin decreased by 7.2 percentage point to 14.0% in the period Q1-Q3 as a consequence of higher energy and other input costs, a negative impact from acquisitions and a base effect from the fact that we are raising sales prices to safeguard our absolute earnings per hectoliter.

Free cash flow amounted to DKK 304 million in Q3 2022 compared to DKK 551 in Q3 2021, whereas free cash flow for the first nine months of 2022 was DKK 614 million compared to DKK 1,234 million in Q1-Q3 2021. The development is negatively impacted by an increase in working capital, higher capex and last year’s positive contribution from extended payment terms for taxes in Finland, which is not repeated in current year.

The full-year outlook for net revenue in the upper half of the range DKK 10,700-11,700 million and an EBIT of around DKK 1,600 as set out in the Company Announcement No 44/2022 on 18 October 2022 is maintained.

Selected financial highlights and key ratios


Q3 2022

Q3 2021

Q1-Q3 2022

Q1-Q3 2021






Volume (Thousand hectoliters)





Organic volume growth (%)





Net revenue





Organic net revenue growth (%)










EBITDA margin (%)










Organic EBIT growth (%)**





EBIT margin (%)





Profit before tax





Net profit for the period





Free cash flow





Net interest-bearing debt





ROIC incl. goodwill (%)*





ROIC excl. goodwill (%)*





NIBD/EBITDA (times)*





Equity ratio (%)





Earnings per share (EPS)





*     Running 12-months

**   Upon closer review of the financial numbers, it has emerged that the organic EBIT growth in Q3 2022 was -20% and not -24% as stated in the pre-release announcement (Company Announcement No 44/2022) of 18 October 2022.

Management’s Review
In Q3 2021, the strong top-line momentum was supported by a resilient development in volumes, especially in the On-Trade, which is growing at a solid pace. Our Italian business continues to gain market shares in both beer and CSD, and our International export business delivered strong growth in both volumes and revenue, despite being up against tough comparable numbers from last year.

Our sales and distribution expenses increased by 38% compared to Q3 2021, partly as a result of M&A, higher freight costs in International and a fully re-opened On-Trade, including an event business fully back to normal whereas it was completely locked down in Q3 2021.

Over the past 12 months, we have invested significantly into strengthening the organization and building capabilities. As we are now moving into a more uncertain environment, we expect the fixed cost growth rate to level off.

Raw material prices
The input cost inflation has stabilized since the H1 2022 results announcement meaning that the total increase in our cost base compared to the beginning of 2021 is around DKK 0.8bn of which a part is missing to be covered by price increases. It is our ambition to pass on the remainder of the cost increase to customers. We will experience further cost inflation from the beginning of 2023 as we reprice some of our fixed price agreements with suppliers.

Acquisitions and partnerships
On 15 September 2022, we acquired the Toronto-based company Amsterdam Brewery. The acquisition is based on an enterprise value of CAD 44 million (around DKK 250 million) on a debt free basis. The company has normalized revenue of around CAD 34 million (around DKK 200 million) and a normalized EBITDA of around CAD 5 million (around DKK 28 million).

In the first nine months of the year, acquisitions have contributed with around DKK 1,450 million in net revenue and around DKK 80 million in EBIT.

For the second time during 2022, Royal Unibrew and PepsiCo extends their partnership as Royal Unibrew from 1 January 2023 will take over the responsibility, on a license basis, of the PepsiCo beverage portfolio on the border between Denmark and Germany. The agreement is expected to support the strong growth we have seen in the no/low sugar CSD category in the Nordics during the past years. The agreement includes production, logistics, sales and marketing operation in this important business area. On 1 January 2023, Royal Unibrew will also be taking over the sales, distribution, and trade marketing of Lay's and Doritos in the Nordic countries, including Denmark, Sweden, Norway, Finland, as well as in Greenland and the Faroe Islands.

As announced in company announcement No 46/2022 of 24 October 2022, Danone and Royal Unibrew agreed not to complete the contemplated sale to Royal Unibrew of Aqua d’Or, Danone’s Water and Beverage’s business in Denmark, that was announced on 16 November 2021. The Parties have determined that they will not be able to fulfil the closing conditions, among others the approval by the Danish Competition and Consumer Authority (DCCA). The Parties have therefore withdrawn the notification of the transaction to the DCCA.

Net debt
Net interest-bearing debt by the end of Q3 2022 amounted to DKK 4,364 million, which is an increase of DKK 828 million compared to year-end 2021. Calculated on a running 12-months basis NIBD/EBITDA was 2.2 times by end of Q3 2022 (year-end 2021: 1.7). The increase in net interest-bearing debt is mainly explained by share buy-backs, dividends and acquisitions.

Corporate Social Responsibility
The integration of Hansa Borg was initiated during Q3 and as expected we see a minor negative effect on energy and water efficiencies as measured by consumption per produced unit. The energy efficiency for the Group is also marginally impacted by the temporary switch from natural gas to oil at our site in Faxe. As a consequence, we do expect the CO2 emissions for scope 1 and 2 to increase during the next period.

Despite the challenges from the geopolitical situation, and the associated supply chain challenges, our sustainability journey continues. Our transition towards a fossil free future continues relentlessly with more efficiency projects at our sites and bio-based or electricity-based heat production, as well as we continue our focus on more renewable power through own installations or PPA in combination with certificates.

As planned, our 12 GWh solar panel park in Faxe will be ready to produce from the beginning of next year. The solar panel park will be a significant contribution in reaching our goal of being 100% fossil-free (scope 1 and 2) by 2025.

The full-year outlook for net revenue in the upper half of the range of DKK 10,700-11,700 million and an EBIT of around DKK 1,600 million as set out in the Company Announcement No 44/2022 on 18 October 2022 is maintained.

Full Year 2022 EBIT Outlook


Outlook 2022
(October 2022)

Outlook 2022
(August 2022)

Outlook 2022
(May 2022)

Outlook 2022
(April 2022)

Outlook 2022
(March 2022)

Actual 2021








Net revenue

upper half of

10,700 - 11,700

10,700 - 11,700

10,000 - 11,000

10,000 - 11,000



around 1,600

1,700 - 1,850

1,700 - 1,850

1,650 - 1,800

1,650 - 1,800


The outlook is now based on a lower expectation of the development in consumers’ general out of home spending during the winter season, although we are expecting the On-Trade channel to remain fully open throughout the rest of the year.

We expect that mainstream and below mainstream will gain share in the market, while premium products will likely be consumed by fewer consumers and at fewer occasions.

We expect the destocking among our wholesale partners in Italy to have a one-off impact on results that will be included in the second half of 2022.

For further information on this Announcement:
Investor and Media Relations, Jonas Guldborg Hansen, tel. +45 20 10 12 45

Investors and analysts can register for a conference call on Thursday, 27 October 2022, at 11.00 am CEST at the following link:

The presentation may also be followed here:

Financial Calendar for 2023
1 March 2023        Annual Report
27 April 2023        Trading Statement for 1 January – 30 March 2023
27 April 2023        Annual General Meeting 2023
22 August 2023     Interim Report for 1 January – 30 June 2023
8 November 2023  Trading Statement for 1 January – 30 September 2023

Forward-looking statements
This Trading Statement contains forward-looking statements, including statements about the Group’s sales, revenue, earnings, spending, margins, cash flows, inventories, products, actions, plans, strategies, objectives and guidance with respect to the Group’s future operating results. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the following words or phrases “believe, anticipate, expect, estimate, intend, plan, project, will be, will continue, likely to result, could, may, might”, or any variations of such words or other words with similar meanings. Any such statements involve known and unknown risks, estimates, assumptions and uncertainties that could cause the Group’s actual results, performance or industry results to differ materially from the results expressed or implied in such forward-looking statements. Royal Unibrew assumes no obligation to update or adjust any such forward-looking statements (except for as required under the disclosure requirements for listed companies) to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking statements.

Some important risk factors that may have direct bearing on the Group’s actual results include, but are not limited to: economic and political uncertainty (including interest rates and exchange rates), financial and regulatory developments, development in the demand for the Group’s products, introduction of and demand for new products, changes in the competitive environment and the industry in which the Group operates, changes in consumer preferences, increasing industry consolidation, the availability and pricing of raw materials and packaging materials, cost of energy, production- and distribution-related issues, information technology failures, breach or unexpected termination of contracts, price reductions resulting from market-driven price reductions, determination of fair value in the opening balance sheet of acquired entities, litigation, pandemic, environmental issues and other unforeseen factors.

New risk factors may emerge in the future, which the Group cannot predict. Furthermore, the Group cannot assess the impact of each factor on the Group’s business or the extent to which any individual risk factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Accordingly, for- ward-looking statements should not be relied on as a prediction of actual results.