Danish brewing giant Carlsberg is to dispose of its Russian arm, where it is currently the market leading brewer in the country.
The company announced today that following a strategic review of its presence in Russia it has taken the “difficult and immediate decision” to seek a full disposal of its Russian arm.
Russian revenues previously accounted for around 9% of global turnover, through its ownership of Russia’s biggest brewer Baltika.
However, CEO Cees ’t Hart said leaving the country was “the right thing to do in the current environment”.
“The war in Ukraine, and the escalating humanitarian and refugee crisis, shocks us all. We continue to strongly condemn the Russian invasion, which has led to so much loss of life, devastation and human tragedy.”
As a result, the group will incur a “substantial” non-cash impairment charge and the Russian business will be excluded from group results and considered an asset held for sale.
In 2021, the business in Russia reported revenue and operating profit of DKK6.5bn (£730m) and DKK682m respectively
Carlsberg said it will provide further details on the accounting impact of the planned disposal and the reintroduction of earnings guidance at a later date.
On 9 March Carlsberg said it would stop selling Carlsberg branded beer in Russia and will not make any new investments in the country.
The wholesale departure follows a similar announcement by brewing contemporary Heineken this morning.
Cees ’t Hart added: “We deeply regret the consequences of this decision for our 8,400 employees in Russia. Until the completion of the process, we will maintain the recently announced reduced level of operations to sustain the livelihoods of these employees and their families. Any profits generated during the humanitarian crisis will be donated to relief organisations.
“Our thoughts are with the people of Ukraine and we call for peace to be urgently restored.”
Carlsberg shares were up 3.5% to DKK810.20 on the news – but are down almost 30% since the start of 2022.