Carlsberg Narrows 2026 Profit Growth Outlook to 4%-6% After Strong First Half

Carlsberg raised the lower end of its 2026 earnings outlook after a stronger first half, narrowing its forecast for organic operating profit growth to 4% to 6% from 2% to 6%. The upper end of the range was unchanged, so the revision amounts to a higher floor rather than a broader profit upgrade.

The Danish brewer reported first-half organic operating profit growth of 5.9%. On the company’s Carlsberg performance measure, or CPM, basis, operating profit increased 4.5% to DKK 7.45 billion and the operating margin improved 30 basis points to 15.8%. Revenue rose 2.6% to DKK 47.05 billion, with organic revenue growth of 2.7%.

Net profit on the same CPM basis increased 6% to DKK 4.29 billion, while earnings per share rose 6% to DKK 32.4. Carlsberg also generated DKK 3.69 billion of free operating cash flow, up from DKK 2.92 billion a year earlier, and reduced net interest-bearing debt to DKK 56.8 billion.

Soft drinks and alcohol-free brews support first-half growth

Carlsberg’s first-half financial statement showed total volumes rising 2.8%, with organic volume growth of 1.7%. Beer volumes fell 1.0%, but soft drinks and other beverages grew 7.8% organically. Among the company’s growth categories, soft drinks rose 9%, alcohol-free brews increased 11%, premium beer grew 1% and Beyond Beer advanced 1%.

The international brand portfolio was mixed. Tuborg volumes increased 3% and the Carlsberg brand grew 6%, while 1664 Blanc declined 1%. Pepsi volumes increased 17%, reflecting the growing importance of non-beer beverages in the group following the Britvic acquisition and the expansion of PepsiCo-related bottling and distribution activities in several markets.

Revenue per hectolitre increased organically by 1%, with positive contributions from all three reporting regions. Carlsberg said price increases and a more favorable category mix within beer helped the result, although the country mix and the greater weight of soft drinks, which generate lower revenue per hectolitre than beer, partly offset those gains.

The company also reported a faster pace of deleveraging. Net interest-bearing debt fell from DKK 64.6 billion in the first half of 2025, and net debt to EBITDA declined to 3.0 times from 3.9 times. Carlsberg said the improvement reflected operating cash flow and the issuance of hybrid bonds, partly offset by DKK 4.4 billion of dividend payments in March. Its longer-term financial leverage target is 2.5 times.

Britvic synergies lift Western Europe as China remains soft

Western Europe produced the strongest regional profit growth. Organic operating profit increased 8.7%, CPM operating profit rose 9.1% to DKK 3.61 billion and the regional operating margin improved 80 basis points to 13.8%. Organic revenue growth was 0.9%, while total volumes rose 2.4% because of the Britvic acquisition. Organic volumes were essentially flat.

Carlsberg attributed the Western European profit improvement to tight cost control and faster delivery of Britvic synergies. The company now expects to realize about 50% of the targeted GBP 110 million of cost synergies during 2026, compared with an earlier expectation of 30% to 40%. That faster delivery is one of the main reasons management raised the bottom of the full-year profit growth range.

The underlying demand picture was uneven. Soft drinks in the United Kingdom delivered mid-single-digit volume growth, and the company’s UK beer volumes also grew at a low-single-digit rate. Across Western Europe, however, beer volumes fell 3.9%, with difficult conditions in Poland a major drag. Carlsberg said Poland’s volumes declined by low double-digit percentages amid a soft market and intensified price competition in lower-mainstream beer.

Asia was steadier but faced pressure from China. Regional volumes were flat and organic revenue increased 1.7%, while organic operating profit rose 3.0%. The operating margin improved 40 basis points to 26.3%. In China, Carlsberg’s volumes declined 3% for the half after falling 6% in the second quarter, when a weak market was compounded by severe weather in central and southern parts of the country. The company nevertheless reported growth of more than 20% for the Carlsberg brand within its international premium portfolio in China.

Central and Eastern Europe and India grew faster on the top line. Organic volumes increased 6.2%, organic revenue rose 9.2% and organic operating profit advanced 7.8%. India delivered mid-teen volume growth, while Kazakhstan volumes increased by about 70% following the takeover of the Pepsi licence in late 2025. The region’s operating margin slipped 40 basis points to 16.2%, partly because the large Pepsi business in Kazakhstan is not expected to be profitable in 2026.

Higher guidance reflects better synergy delivery and summer visibility

Carlsberg now expects organic operating profit growth of 4% to 6% for 2026, compared with its previous 2% to 6% range. The guidance is measured against 2025 CPM operating profit of DKK 13.69 billion. Organic growth under the company’s definition excludes currency and acquisition effects, which makes the guidance a measure of underlying operating development rather than reported profit growth alone.

Management cited four factors behind the tighter range: the first-half result, faster-than-expected Britvic synergy delivery, continued cost discipline and better visibility into the important summer trading months. Those positives are expected to more than offset continued softness in China. Carlsberg said it does not currently expect a material change in the external environment or consumer sentiment during the remainder of the year.

The company continues to assume no translation impact on operating profit for 2026 based on currency rates as of August 18. It lowered its expected investing and financing expenses, excluding foreign exchange effects, to about DKK 1.8 billion from DKK 2.2 billion, mainly because of bond redemptions following the hybrid bond issue and accounting reclassifications. Carlsberg still expects an effective tax rate of about 23% and capital expenditure of DKK 6 billion to DKK 7 billion.

Carlsberg adopted IFRS 18 from January 1, 2026 and restated its 2025 comparative figures, while its management commentary now places greater emphasis on CPM measures. On an IFRS-reported basis, first-half operating profit was DKK 6.64 billion and net profit attributable to Carlsberg shareholders was DKK 3.80 billion. The distinction matters because the full-year organic operating profit guidance is expressed on the CPM basis rather than the IFRS-reported operating profit line.

The next scheduled update is Carlsberg’s third-quarter trading statement on October 29, when investors will get a clearer view of whether summer demand, Britvic integration and the Chinese market are tracking closely enough to keep the revised 4% to 6% range intact.