Q3 2020 Trading Statement

Company Announcement No 37/2020 – 17 November 2020

Very strong Q3 2020 leads to EBIT-increase of 5% in the first 9 months of 2020 

The Royal Unibrew multi-beverage model has demonstrated its resilience in a time with COVID-19 related uncertainties. The pandemic continues to challenge some sales channels, and we look into a Q4 with additional restrictions such as limited opening hours at bars and restaurants and ban on gatherings in larger groups as well as imposed limitations on border trade between Denmark and Germany.

During the summer months the majority of consumers spent their vacation in their home country. The high level of staycation in combination with good weather in August in Denmark and Finland and our portfolio of local brands provided a strong performance over the summer.

In order to mitigate the impact from COVID-19, we reduced sales and marketing spending in the spring. As the business performance was strong over the summer, we started to invest selectively into our brands. The effect will be higher marketing costs in Q4 compared to the same period last year.

Despite the impact of COVID-19, strong operational focus and cost management, effect from staycation as well as good weather in August improved the profit in Q3. The social distancing and gathering restrictions were partly lifted during the summer and continued the good momentum that started in June.

Key highlights of the quarter:

• Organic revenue growth of 6% 
• Continued strong performance in Off-Trade
• On-Trade in Italy performed better than expected
• Low sales and marketing expenses
• Dividend of DKK 600 million was paid, and a new share buy-back program of up to DKK 200 million was initiated.

New share buy-back program

The Board of Directors has decided to initiate a new share buy-back program of up to DKK 200 million that will run until end January 2021.

This is on top of the DKK 245 million share buy-backs that have already been executed during 2020. The total amount launched during 2020 will be DKK 445 million.

Financial highlights Q3-2020

Volume for Q3 2020 increased by 5% compared to Q3 2019 and amounted to 3.2 million hectoliters. For Q1-Q3 the volume was at the same level as in 2019.

In Q3, net revenue increased by 7% and amounted to DKK 2,258 million compared to DKK 2,114 million in Q3 2019, while the net revenue was 1% lower in Q1-Q3 than in 2019 and amounted to DKK 5,824 million compared to DKK 5,905 million in 2019.