Annual Report 2001 - Carlsberg Group

Letter to the Shareholders
3
ies in 2001, earnings per share totalled DKK 19.5
against DKK 19.1 last year (+2%).
Net turnover increased by 34% on last year (12
months) and the growth is mainly attributable to the
addition of Orkla’s beverage activities, the inclusion
of the Feldschlösschen brewery in Switzerland for
the entire financial year (against 1 month in 1999/
2000), the acquisition of Türk Tuborg in Turkey and
marked growth in Eastern Europe.
In recent years, substantial investments have
been made in acquisitions and new production
plant. As a result, the net interest-bearing debt
has increased and now totals DKK 11bn or approx.
27% of the balance sheet total.
The Board of Directors proposes that a dividend
of DKK 5.00 per DKK 20 share be paid, or
25% of the share capital, against DKK 5.40 per
DKK 20 share last year (15 months). DKK 320m
(DKK 345m in 1999/00) has been appropriated for
that purpose. This is an actual increase of 16% as
the dividend last year covered a period of 15
months. The proposed dividend corresponds to
21% of Carlsberg’s share of profit for the year. It is
proposed that the remaining amount of DKK
1,187m be appropriated to the reserves.
International structural adjustment
and Carlsberg Breweries
Carlsberg will continue to strengthen its position
as one of the world’s large international breweries.
The consolidation trend in the industry with the
concentration of fewer and larger groups continues,
and Carlsberg aims to play an active part in
this process in order to capture significant market
shares.
With the establishment of the subsidiary
Carlsberg Breweries A/S, a goal-oriented and
strong international brewery and soft drink group
with considerable growth potential has been
created. Carlsberg Breweries will profile the
Carlsberg brand as a leading, international, topquality
brand and will market an extensive portfolio
of strong regional and local brands.
It remains Carlsberg’s goal to gain market
share in the growth markets in Eastern Europe
and Asia to compensate for the stagnating trend
in the more traditional markets in Western Europe,
while still seeking to expand influence in that region
as well. Competition from other international
brewery groups is intensifying in the growth markets.
Joint ventures in Eastern Europe, Baltic
Beverages Holding (BBH) and in Asia, Carlsberg
Asia, enjoy strong market positions and strengthen
Carlsberg’s growth potential.
For Carlsberg Breweries, 2001 was primarily
the year in which Orkla’s beverage activities were
integrated with the Carlsberg activities. In Sweden,
Carlsberg Sverige was established and Pepsi
was introduced. Coca-Cola was wholly or partly
integrated into the companies in Denmark and
Finland, and the brewery in Switzerland launched
a restructuring process. At the same time, reductions
were made in headquarter staff and organisational
adjustments were implemented to meet
the new challenges.
In Eastern Europe, BBH showed substantial,
profitable growth, and the acquisition of local
breweries continued. Furthermore, Carlsberg
Breweries took over the controlling interest in
Türk Tuborg, Turkey and established the majority
owned Polish brewery Carlsberg Okocim through
local acquisitions.
In Asia, the establishment of the new joint venture
Carlsberg Asia has been delayed, primarily
due to pending public authority approvals.
Western Europe was characterised by a generally
stagnating market trend, leading to necessary
restructuring projects and cost adjustment. The
breweries in all markets showed better performance
than expected, except for Sweden, which
experienced problems due to a declining market
as well as to the cost structure in the new and
larger Carlsberg Sverige.
Corporate Governance
The concept of Corporate Governance is currently
a topic of discussion in Denmark, primarily following
the recommendations presented by a Danish
committee of top business executives in a recent
report on the subject. Carlsberg continuously fol-