In August 1999, Carlsberg A/S established three working groups to suggest further savings within the sales, production, and distribution areas of the Danish beer business. The background to this decision was declining beer sales, which have meant that in the financial year 1998/99, Carlsberg has sold around 800,000 hectolitres less than it did in 1994/5. That corresponds to a reduction of around 240 million bottles of beer. During this period, Carlsberg A/S has maintained its 71% market share.
The working groups in the areas of sales and production have completed their tasks, while work continues in the distribution area.
In production, changes will mean higher utilisation of capacity and better productivity, resulting in lower production costs. The capacity of the brewery in Valby (Copenhagen) will be reduced, one bottling line will be shut and the manning agreement changed. Fredericia Brewery will take over some production from Valby, but the work force will remain largely unchanged.
In sales, changes will result in a more efficient customer- and market-oriented sales organisation. Significantly, the Carlsberg and Tuborg sales forces will be brought together in a single organisation.
The savings, which will be carried out over the next 18 months, will mean the loss of 230 jobs, 122 in production and 108 in sales.
Concerning the loss of these positions, an agreement has been made with workers' representatives regarding redundancy payments and help in finding a new job for all affected workers.
The savings project mean that Carlsberg will use Dkr80 million for investment in production, sales and for redundancy packages. The project, when completed, will result in annual savings of Dkr90 million.
Lars Kjær, executive vice-president, Division Denmark, comments:
"It is saddening that Carlsberg has to say goodbye to over 200 talented and loyal workers. However, with declining beer sales it is unfortunately necessary if Carlsberg is to maintain its earnings and its position in the Danish market. By carrying out these savings, we are convinced that Carlsberg will continue to be well prepared for the tough competition in the Danish beer market."
Note to editors:
Carlsberg's Danish beer division employs around 2,300 workers. Production takes place at Carlsberg in Valby, Copenhagen, and Tuborg in Fredericia, Jutland.
For further information contact:
Information manager Henrik Mølstrøm.
Tel: +45 33 27 33 27