Carlsberg: 2023 financial results and the Russia exit
In 2023, Carlsberg faced a dramatic shift in its financial landscape as the group reported a net loss that expanded 38-fold compared with the prior year, totaling 5.9 billion USD. The primary driver behind this surge was the group’s withdrawal from the Russian market, a strategic decision disclosed in the company’s fourth quarter earnings release for 2023. The move marked a turning point in Carlsberg’s regional exposure and had significant accounting implications for the group’s consolidated results.
Data from the annual figures show that the prior year’s net loss stood at 40.8 billion Danish kroner, approximately 5.9 billion USD, while the year before that marked a loss of 1.1 billion Danish kroner. The company attributed the large rise to deconsolidation of its Russian operations and the depreciation of assets related to those entities, amounting to about 48.5 billion Danish kroner. This accounting treatment reflects the group’s exit from Russia and the associated write-downs as it unwound its holdings in the country.
Despite the withdrawal from Russia, Carlsberg reported a revenue increase in 2023, rising by 4.7 percent to 73.6 billion Danish kroner. The fourth quarter showed continued momentum with revenue up 6.3 percent year over year, underscoring a resilient performance in regions outside of Russia and a stronger demand environment that supported top-line growth despite the exit from the Russian market.
During autumn 2023, Carlsberg sought compensation for losses tied to the Russian exit, specifically related to the transfer of management of Baltika breweries to the Federal Property Management Agency. The group indicated it would pursue international arbitration if an amicable resolution could not be reached within a six-month window, signaling its intent to protect shareholder value and recover certain carrying costs associated with the exit.
In late October, the company’s chief executive officer spoke out about perceived hostility from Russian authorities, describing actions as a form of interference with the business. The Russian Ministry of Finance responded by denying blame and attributing the external management arrangement to sanctions. Dmitry Medvedev later commented that Carlsberg had chosen to cease operations in Russia and expressed appreciation for the investments that were made, framing the decision as a strategic retreat rather than a punitive action. The exchange highlighted the broader geopolitical pressures impacting multinational firms operating in Russia during the period.
Prior communications from Danish corporate leadership had suggested plans to maintain a presence in Russia, reflecting the nuanced and evolving stance of foreign investors in the region. The 2023 results thus capture a complex narrative: a bold step to exit a key market, accompanying financial write-downs, a steady if uneven rebound in revenue from other markets, and a continued emphasis on governance and strategic realignment amid sanctions and geopolitical headwinds. The company’s disclosures indicate a careful balancing of short-term losses with longer-term strategic repositioning in a volatile international landscape. [Carlsberg annual report 2023]