KUALA LUMPUR (Feb 23): Carlsberg Brewery Malaysia Bhd (Carlsberg Malaysia) reported a 15.8% net profit drop to RM60.12 million in its fourth quarter ended Dec 31, 2022 (4QFY2022) from RM71.42 million in the same quarter last year, as its operations in Malaysia recorded lower profit, further weighed by its provision for the Cukai Makmur or Prosperity Tax.

Its profit from operations dropped 4.3% to RM83.5 million as the group's operations in Malaysia absorbed various one-off costs during the quarter under review, including the loss on disposal of an old bottling line and after investing in higher marketing spend given the earlier timing of the 2023 Chinese New Year, its Bursa Malaysia filing showed.

The drop in Malaysian ops' profit was mitigated by Singapore's higher profit, which grew by 15.9% to RM23.8 million, in line with its revenue growth.

The group's overall effective tax rate for FY2022, meanwhile, was at 28.27% higher than the preceding year's 22.59%.

Carlsberg recorded an earnings per share of 19.66 sen for 4QFY2022, down from 23.36 sen in 4QFY2021.

The lower quarterly earnings were despite a 13% increase in quarterly revenue to RM612.8 million from RM542.3 million, with both its Malaysian and Singaporean operations showing better overall sales for the quarter.

“Malaysia’s revenue increased by 8.4% to RM427.7 million, with growth in both volume and value since the country transitioned into the endemic phase effective April 1, 2022. Singapore also registered sales revenue for 4QFY2022 of RM185.1 million, an increase of 25.3% following the easing of Covid-19 restrictions and lifting of travel restrictions,” the group said.

The group proposed a final dividend of 25 sen per share (4QFY2021: 46 sen per share) to shareholders, raising total proposed dividends for FY2022 to 88 sen per share, compared with FY2021's 56 sen per share.

For the full FY2022, the group's net profit jumped 57.7% to RM317.05 million from RM200.99 million in FY2021, driven by top-line growth and higher profits in both its Malaysia and Singapore ops, combined with a higher share of profit in Lion Brewery (Ceylon) plc (LBCP) in Sri Lanka.

Annual revenue increased by 36.1% year-on-year to RM2.41 billion compared to RM1.77 billion. Carlsberg Malaysia also said the previous year was a lower base due to various lockdown restrictions then including the suspension of brewery operations from June 2 to Aug 15, 2021.

“The group registered a higher share of profit in its associated company LBCP of RM21.5 million compared to a share of profit of RM15.2 million in the previous year, despite accounting for a share of surcharge tax expense amounting to approximately 298.5 million Sri Lankan rupees, equivalent to RM3.7 million in current year,” it explained.

In a separate statement, the group’s managing director Stefano Clini said 2023 will be another challenging year as global recession looms and rising inflation is expected to affect consumer sentiment.

“The disruption to global supply chains and the escalating commodity prices will remain a challenge that needs to be managed," he said.

Nevertheless, he also noted that the removal of total travel restriction globally is expected to boost consumer demands as Malaysia and Singapore anticipate more inbound travellers.

Shares in Carlsberg Malaysia rose 14 sen to close at RM23.44 on Thursday, valuing the group at RM7.17 billion.