OREANDA-NEWS. Baltika Breweries LLC, a leader of the Russian brewing market, announces its operating results for the third quarter of 2014.

According to the company estimate, the beer market decline over three quarters of 2014 was 6-7%% as compared to the similar period of 2013. In the third quarter the market decline was not as severe as expected thanks to favorable weather conditions, especially in the end of the quarter. In general, the market decline over 9 months of 2014 was due to the general macroeconomic situation generating a negative effect on consumer behavior and restrictions for beer selling time and place.

Over the third quarter of 2014 the volume market share of the company has grown by 1.4% as compared with the second quarter and amounted to 37.9 % . The market share by value, as compared with the second quarter, has also grown by 1.3 %. The company has significantly strengthened its positions in modern trade channel as compared with the previous quarter, as well as compared with the similar quarter of 2013. Nonetheless, the company volume market share by the results of three quarters of 2014 is still lower than in the same period of 2013 (-1.1%). Such decline in the first six months was conditions by launching new smaller containers, as well as by technical difficulties in sales due to the changed business legal structure of Baltika.

The market share in value terms has not declined so significantly - by 0.5 %, since the market share loss was most pronounced in the economy segment. Baltika continues implementing the strategy of balancing volumes and cost, and the company managed to achieve the best results in the share dynamics in value terms.

The company share in the premium segment has grown in the third quarter. The main growth drivers became brands Baltika 7, Koff, Zhatetsky Gus and Brewer's Collection brands. Brands Baltika 9 and Baltika Praha have also demonstrated growth. Despite the market realities the company continues investing into brand development and maintains high level of marketing activities. A number of newly designed products have been launched over the last months: two brands from the Brewer's Collection, vintage beer Tuborg Gold, cider Sommersby; we started importing craft beer Jacobsen into Russian and we manufactured a limited lot “5 continents” of beer Baltika No 7 Export. Beside that, the company presented the first in the Russian market line of drinks in the “Hard Drink” category under brand Seth&Riley's Garage. The company is still sponsoring sports teams and events, such as Continental Hockey League, football teams “Krylia Sovetov” and “Arsenal”, ball hockey championship, as well as supporting summer festivals “DAS FEST”, “DON-Fest”, music festivals “Prostor” and “Tuborg Greenfest”, which has expanded its geography in Russia this year.

Isaac Sheps, President of Baltika Breweries, Senior Vice President Eastern Europe, Carlsberg Group: “The Russian beer market has experienced significant changes over the last few years”. Despite the external challenges and complex legislative conditions for business operations we still see long-term growth opportunities in the country. We keep focusing on investments, on maintaining cost-efficiency and balance of out price mix, we plan business development scenarios more carefully and we are continuously adapting the structure and the processes to the ever-changing market conditions. To fortify our positions, we well be promoting our premium and middle-cost segment brands and we will be implementing instruments for commercial efficiency improvement, as well using experience and best practices of the Eastern Europe region”.