Copenhagen — Danish brewer Carlsberg said on Thursday that it expects operating profit to fall by as much as 15% this year as lockdowns will hurt sales in the second half in key markets of China and Western Europe, sending its shares more than 5% down.

The world’s third-biggest brewer after AB InBev and Heineken suspended the second tranche of a share buyback and said it will cut an unspecified number of jobs at its head office in Copenhagen.

It said that although drinkers had started to return to bars and restaurants in China and Western Europe over the summer, lockdowns are likely to keep sales subdued for the remainder of the year.

The Chinese market, its biggest by volume, started the third quarter well but sales have been hurt more recently due to renewed lockdowns in parts of the country, it said. In Western Europe, sales at bars and restaurants are gradually recovering but are not expected to return to normal levels this year.

“Recognising that we’re faced with a new market reality, including changed consumer preferences and a reduced level of on-trade activity, we’re taking measures to adapt our business accordingly,” CEO Cees ’t Hart said.

The company suspended guidance in April, but said on Thursday that it expects a decline in organic operating profit this year of 10%-15%.

Shares in Carlsberg were 5.3% lower at 889 krone each by 7.44am GMT. The shares have risen more than a third since mid-March but are still trading below an all-time high of 1,065 Danish krone hit in January.

The price/mix, which indicates whether the company sold more or less of its expensive beer, was -7% in the second quarter, Carlsberg said in a statement.

Second-quarter sales fell 15% from a year earlier to 15.9-billion Danish krone ($2.5bn) on a fall in total volumes of 8%, in line with preliminary figures posted last month.


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