Jorgen Buhl Rasmussen - President and CEO Jorn Jensen - CFO and Deputy CEO

Michael Vitfell-Rasmussen - ABG Sundal Collier Trevor Stirling - Sanford Bernstein Sanjeet Aujla - Credit Suisse Soren Samsoe - SEB Enskilda Nik Oliver - BofA Merrill Lynch Ian Shackleton - Nomura Richard Withagen - Kepler Cheuvreux Andrew Holland - Societe Generale Andrea Pistacchi - Citigroup Simon Hales - Barclays Capital Chris Pitcher - Redburn Tristan van Strien - Deutsche Bank Jonas Guldborg Hansen - Carnegie Bank Hans Gregersen - Nordea Bank Frans Hoyer - Jyske Markets

Welcome to the Carlsberg Q3 report 2014. [Operator Instructions]. Please note that this conference is being recorded. I'll now turn the call over to CEO, Jorgen Buhl Rasmussen. Jorgen, you may now begin.

Thank you, and good morning to everybody, and welcome to our nine months 2014 results conference call. As you heard, my name is Jorgen Buhl Rasmussen, and I have with me our CFO, Jorn Jensen, and Vice President of Investor Relations, Peter Kondrup. Please turn to slide three and the headlines for the first nine months. We saw market value growth in all regions; in volume terms, beer markets that are mixed; the slightly growing Western European markets; a decline in Eastern Europe; and continued growth in Asia. We grew our market share year on year in Western Europe and Asia and our Eastern European market share grew sequentially. Driven by our strong commercial execution, we continue to improve price and mix and delivered a very healthy 4% price/mix improvement. We continue to push our commercial agenda and maintain the high level of investment in our international brand portfolio, and we launched several innovation, and maintained an overall high level of commercial activities. Our cost agenda remains unchanged and we focused on executing our many efficiency programs, including the rollout of BSP1 which had been live in three more markets in October. The significant integration task of Chongqing is progressing according to schedule, and we are strengthening and refreshing sales capabilities and brand portfolio, as well as implementing Carlsberg tools and processes in all functions. Despite the weak Eastern European markets, we sustained a solid operating profit growth, delivering 5% organic growth for the nine months. And slide four please. Beer volumes for the nine months declined organically by 2%. Volumes grew in Western Europe and we saw flat volume development in Asia and declining volumes in Eastern Europe. Reported beer volumes grew by 4% due to the acquisition impact from Chongqing. And slide five please. Organic net revenue growth was plus 3%, supported by the continued healthy price mix development of 4%. Operating profit grew organically by 5%. That was driven by growth in Western Europe and Asia and decline in Eastern Europe as a result of the market decline and higher cost than last year. In addition, Q3 in Eastern Europe was impacted by different phasing of sales and marketing versus last year, write-off on obsolete stocks, and phasing of last year's cost reductions. The acquisition impact was related to the purchase of Chongqing Brewery. And the substantial negative currency impact was due to weaker currencies in several markets, especially in Eastern Europe. All in all the Group delivered flat operating profit growth despite the volume decline in Eastern Europe and the substantial negative currency headwind. And now slide six please and an update on our international premium brands. Overall we continue to push our commercial agenda and saw a strong performance of our overall international premium brands. The Carlsberg brand grew 3% in this premium markets. The brand did particularly well in Asia, driven by good performance of Chill and Light in China and Carlsberg Elephant in India. In September we started the activation of the Euro 2016 football sponsorship. The Tuborg brand grew 23%. An important driver was Asia; their volumes more than doubled as a result of good performance in China and India. 1664 grew by 10%, mainly driven by good performance in France. This was partly due to easy comps due to destocking in Q1 last year and partly due to market growth and share gains. In addition, the brand achieved good results in Asia. Our super-premium beer Grimbergen grew 30% due to strong expansion to new markets and market share gains in France. And Somersby grew 43% as a result of rollout in new markets, line extensions in existing markets and strong performance in Poland, the UK and Portugal. And now to slide eight please, and a few comments on our regions. The Western European markets was slightly growing for the nine months. Q3 markets declined mainly as we were cycling last year's very strong July. We continue to strengthen our market positions and our overall Western European market share grew year to date, with particular strong performance in Q3. We gained market share in the majority of our markets. Based on the nine months performance, we are on track to deliver share gain in the region for the fourth year in a row. Our beer volumes grew organically by 3%, mainly as a result of market share growth, the slightly growing markets, and destocking in France last year. Price/mix was down by 1%. The positive impact from our value management efforts across the region was offset by the growth in other beverages and channel mix. Our non-beer volumes grew organically by 6%, primarily due to strong performance in the Nordics. In Poland, we grew beer volumes by 6% in a market growing by an estimated 1%, and we gained both volume and value share. Strong commercial execution, increased distribution and strong performance of our local power brands Somersby and Radler explain the strong growth. Price/mix was flat in Poland. Our French volumes grew by 13% in a market growing by an estimated 3%. Our volumes were positively impacted by last year's destocking in Q1. Our market share was slightly up, driven by strong performance of our premium brands such as 1664, Grimbergen and Tuborg Skoll, as well as by K, by Kronenbourg, in the mainstream segment. The UK market grew 1% after strong Q2 and softer Q3, and our market share declined. Our Nordic business performed strongly, driven by better weather than last year, soft drinks category growth, and strong commercial execution which included the launch of innovations and the ongoing value management efforts. The markets and our volumes grew in Denmark, Norway and Sweden, while the Finnish market was flat. In March, BSP1 was rolled out in the UK and October 1 in Finland, Poland and Switzerland. The next wave of markets is expected to be in the spring of 2015. Operating profit grew strongly by 7% and operating profit margin expanded by 50 basis points to 14.9%. The earnings growth was driven by the volume growth, cost savings [related to] supply chain and the overall efficiency improvements in all areas throughout the Group, and in spite of the higher BSP1 costs. Slide nine and Eastern Europe. The Eastern European markets remain challenging due to the overall uncertain macro environment in Russia and Ukraine. The Russian beer market declined an estimated 6% to 7% for the nine months, supported by good weather in Q3. The beer market in Ukraine was down by approximately 10%. Our beer volumes declined by 10%, mainly driven by our Russian business. Organic net revenue declined by 1% and by 17% in DKK, due to the significant negative currency impact from the Russian and Ukrainian currencies. Price/mix was very strong at 9%. The price/mix was mainly driven by price increases, mix improvements and the changed pack sizes in Russia. Organic operating profit declined by 4% and operating profit margin by 50 basis points. The strong price/mix and efficiency improvements were not enough to offset the impact of lower volumes, and in Q3, higher sales and marketing investments versus last year and write-off on obsolete stocks in Russia and the phasing of last year's cost reductions. The write-off on obsolete stocks happened following the significant changes in the Russian market that has caused some inefficiencies in the Russian supply chain during the last quarters. And slide 10 and Russia please. The Russian market declined by an estimated 6% to 7% for the nine months, as well as in Q3. The market is impacted by the slow economic growth which impacts overall consumer spending negatively. Q3 market development was slightly better than anticipated due to the very favorable weather conditions in September. Underlying, we estimate that the market in Q3 declined by high single-digit percentages. We strengthened our market share versus the second quarter by 140 basis points to 37.9% of Q3, although we lost year on year. The reasons behind the year-on-year loss are the same as we explained after Q2. Firstly, our price leadership, primarily in modern trade, impacted our share negatively. Secondly, we have replaced some SKUs, with SKUs containing slightly less liquid, in order to minimize price increases and improve affordability. This impacted volume share negatively but price/mix positively. And finally, in March/April we had to list these new SKUs at the same time as Baltika changed its legal structure, and this created some disruptions in deliveries. We continue to execute on our strategy of balancing volume and value, and consequently, we managed to show much better value than volume share dynamics. Good performance of local brands such as Baltika 7 and Baltika 9, as well as good performance of several of our premium innovations, are the drivers of this. Our volumes declined by 11% due to the market decline and market share developments. Price/mix for beer was thus 8%, driven by price increases in March and May, mix improvements and value engineering, i.e. the launch of the aforementioned smaller pack sizes. And in October we took another price increase of 2%. We often receive questions on regulation. The only news since our Q2 announcement is that the proposed excise tax fees for 2015 has been through the first reading in the Duma. And now on slide 11 please, and on Asia. In Asia, our continued efforts to strengthen our markets -- the market positions continue to yield positive results, and we increased our market share in most markets in the region. We kept a high level of commercial activities, including a strong push behind our international premium portfolio which continues to deliver outstanding results. Tuborg more than doubled its volumes and Carlsberg grew 14% in its premium markets. In addition, we revitalized our local power brands and further strengthened sales capabilities. Including the Chongqing acquisition, beer volumes grew by 26% and 35% in Q3. Organically, volumes were flat. With 4% organic volume growth in Q3, the volume trend improved during the year. We saw particularly strong growth in India, Nepal, Cambodia and Laos and for the international premium portfolio in China and India. For the nine months, the beer market in the Western Chinese provinces performed worse than the overall Chinese market due to the unrest in Xingjian and bad weather in several provinces. In Q3, dynamics in the western Chinese provinces were better than the overall Chinese market which declined by an estimated 8%. In addition, our volumes were impacted by the delisting of unprofitable SKUs in one province. Excluding China, our regional volumes grew by, organically, by 10%. Driven by a strong price/mix of 7%, organic revenue growth was 11%. Organic growth in revenue accelerated during the year. The strong price/mix improvement was driven by our international premium brands, price increases and value management efforts across the region, and delisting of low-priced and unprofitable SKUs in China. In China, the portfolio cleanup led to a very strong price/mix and we achieved low single-digit organic revenue growth in spite of the volume decline. Organic operating profit grew by 7%. Profits were impacted by investment in growth such as the startup in Myanmar and higher sales and marketing investments. However, this negative impact was more than offset by the positive price/mix and an income from a terminated license agreement in Q2. Profit dynamics also accelerated positively during the year. As expected, the operating profit margin decline was due to the consolidation of Chongqing Brewery that has a margin somewhat below the Asian regional average. And with this, I would like to hand over Jorn who will now walk us through the financials.

Thank you, Jorgen. Please turn to slide 13. As already explained, trading conditions in Eastern Europe remained soft in Q3 due to the impact of the uncertain geopolitical environment on the economy and the consumers. In this business climate, I'm pleased that we were able to offset the negative development in our Eastern European business through strong commercial execution and [a tight rope] on costs and efficiencies across the Group which delivered growth in operating profit for both Western Europe and Asia. For the first nine months, price/mix, gross profit and operating per hectoliter were all up mid-single-digit. BSP1 is now live in six countries. On October 1, Finland, Poland and Switzerland went live, and this transition has gone very well. As I've stated before, the transformation of BSP1 project is very important and represents a step change in our Western European operating model. And now to slide 14 and the income statement. Organic net revenue increased by 3% or DKK1.5 billion, driven by a positive price/mix, the acquisition impact amounted to DKK2.2b, and were mainly related to Chongqing Brewery. The negative currency impact was mainly due to the Eastern European currencies. Cost per hectoliter increased slightly organically. However, due to the positive price/mix, gross profit per hectoliter developed positively and was up 6% in organic terms. Reported gross profit margin was up 10 basis points, while the organic gross profit margin improved by 60 basis points. Total OpEx increased organically by 6%. This increase was mainly driven by higher logistic cost in Eastern Europe, BSP1 related costs in Western Europe, and higher sales and marketing investments. BSP1 costs amounted to approximately DKK350 million, in line with our plans. All in all, organic growth and operating profit was DKK369m or plus 5%. As I mentioned on the previous slide, this growth was driven by strong results in Asia and Western Europe which more than offset the negative development in Eastern Europe. Reported operating profit was flat due to the significant negative currency impact. And now to slide 15. Special items were up a little versus last year and amounted to minus DKK218 million. Net interest costs were down DKK185 million compared to last year due to lower average funding costs. Other financial items were impacted by currency movements and fair value adjustments and increased by DKK150 million. Pretax profit was flat versus last year due to the adverse impact from currencies. And finally, the tax rate was 25%, and consequently, reported net profit was down 1%. And now to cash flow on slide 16. The sum of the first three lines, EBITDA including other non-cash items adds up to DKK10.1 billion, which is on part with last year. The change in trade working capital was minus DKK427 million. Trade working capital was impacted by seasonality and higher invoice prices. The 12-month average trade working capital to net revenue was minus 3.7% compared to minus 3.5% last year. The change in other working capital was impacted by lower VAT payables and amounted to minus DKK706 million. Paid net interests were DKK1.1 billion, which was down significantly from last year. The decline was due to lower funding costs as well as settlement of financial instruments last year, i.e., all in all, the cash flow from operations was DKK6 billion. And slide 17. CapEx was DKK3.3 billion and was primarily driven by capacity investments in Asia, some structural enhancement investments in Western Europe, and finally, investments in sales equipment to generate top-line growth. Net acquisitions amounted to minus DKK23 million. This was significantly less than last year when it was impacted by prepayments related to the acquisition of shares in Chongqing Brewery. All in all, free cash flow was DKK2.6 billion, an improvement of DKK199 million versus last year. And now to slide 19 and the full year outlook. Based on unchanged assumptions, we maintain the outlook for the year. We expect a low to mid-single-digit percentage growth in organic operating profit, including the acquisition impact from Chongqing and the assumed significant currency headwind. Reported operating profit is expected to decline by low to mid-single-digit percentages. The outlook is based on an unchanged average ruble/euro exchange rate of approximately 50 for the year. This includes an average exchange rate of around 48 for the first nine months and a further devaluation in Q4. Despite the lower operating profit margin in Eastern Europe in Q3, we expect the full year margin to be as previously indicated, close to last year's level. You might also recall that the margin was quite high in Q2, i.e. there can be significant differences from quarter to quarter. Adjusted net profit or clean EPS is expected to decline by mid to high-single-digit percentages. And as said, after Q2, this outlook does not assume the usual high level of stocking at distributors in Russia end of the year.

Thank you, Jorn. And this was all for today. Before Q&As and to summarize, the Group managed to deliver 5% organic operating profit growth and increased cash flow despite the market challenges in Eastern Europe. We delivered solid market share performance in most markets and especially our international premium brands and innovations are performing strongly. Price/mix was a healthy 4%. And finally, that we are able to deliver such results in the current environment underpin the strength of our business model, our brands and our people, as well as our ability and determination to focus on executing on our key priorities. And now we are happy to take questions.

Thank you. We'll now begin the question-and-answer session. [Operator Instructions]. First question is coming from Mr. Michael Rasmussen from ABG Sundal Collier. Please go ahead sir. Michael Vitfell-Rasmussen: Thank you and good morning everybody. I'd like to start up in Russia and ask. And so peers have followed you in putting in less volume in each bottle, and just how that is driving the market dynamics, i.e. how are consumers actually -- are consumers reacting to this at all? And then also if you could give us a little bit more insight into the 140 basis points market share improvement you saw sequentially from Q2. What do you think is driving this? And do you think you can drive your market share kind of above the level that you had before the changed legal structure in Baltika. And then second question, on Russia, the deregulation, there's been some more stories in the media both about the potential beer duty freeze, but there's also been some talks about a change of the kiosk ban and other changes. Can you give us a full update please on how you see these things, and more importantly, probably, what do you think is driving this sudden change to lawmakers? And finally, are you budgeting 2015 with or without higher duties in Russia? Thank you.

Thanks, Michael. To your first question about downsizing, I can say competition seems to be following. So if you take the kind of -- the major players, the four players, the big ones, two more definitely following and one is already in the market, and the other one is kind of coming into the market. So there's only one left of the four major players that we haven't seen any signs yet. On the 140 basis points share growth, very strong performance in general in modern trade, where we see strong performance. I would say it's a combination of brands, innovation and promotional activity that drive the share gain. And as I've said many, many, many times in the last many, many years, share will be up and down in quarters, and more important that we stay on a positive trend line. So don't assume 140 basis points every quarter. It will be up and down by quarter, so trend line is much more important to look at, and I think we are on the right trend line this year compared to last year. On regulation, as we stated also in our release, the duty freeze has been through the first reading, not yet the second reading, and that's really the important one. I would it looks likely, but nothing is given until it has been through the second reading. Let's see. In general, there's definitely, as you refer to also, a lot more kind of positive statement being made about regulation and not regulation, and maybe turn back somewhat the regulation being put in place in the last few years. So, more positive sentiment about regulation for the beer category for alcohol in general. I think it's driven overall by a tough climate in Russia, tough business climate, but also based on a much better understanding of -- in the political environment that this industry, the beer industry, has been through some very, very difficult years, with a lot of negative consequences in terms of GDP, in terms of employment in the regions, etc. I think that understanding is much better now than what it was a couple of years ago, and probably drive this more positive sentiment.

And Michael, on your final question, as always, we are not at this point in time discussing call it individual assumptions through the budget for next year. We'll take all that when we get to February.

Next question is from Trevor Stirling from Bernstein. Please go ahead. Trevor Stirling - Bernstein: Morning, gentlemen. A couple of questions from my side. Firstly, in looking at Russian margins, we've had a lot of quarterly volatility and you outlined some of the reasons for that. If you're trying to look at the underlying trend, is it fair to look at the nine months, the 50 bps of share of margin decline in the nine months and say that's really the underlying trend at the moment? As a second question related to that, as you talked to us already, that you're reexamining your network in Russia, I fully understand why you're not in the position to talk today, but have you any idea when you think you will be ready to talk about what the future shape of the network might be?

Trevor, yes, to the first question. You're right, that it is -- it can be volatile from quarter to quarter, underlying it is a small reduction that we're seeing as a trend for this year. And as you also alluded to when it comes network, as we said last time, we do have too many breweries in Russia, and then we will talk about that when we are ready to talk about, i.e. when we can announce something, and that is not today. Trevor Stirling - Bernstein: Okay. Could I ask maybe one follow-up Jorgen? The central costs, we're talking about EUR100 million in the quarter, is part of the reason behind that, as you've talked in the past, about charging out BSP costs to the regions?

DKK100 million. It's more about again phasing between quarters. For instance, in Q3 where we had three markets going live, it's far more local costs of implementing than it is about call it central support development costs being incurred. And that again will vary from quarter to quarter.

Next question is coming from Sanjeet Aujla from Credit Suisse. Please go ahead. Sanjeet Aujla - Credit Suisse: Yes. Hi guys. Noticed again the price/mix trends continue to be strong in Eastern Europe. I think you had expected a bit of a deceleration in the second half of the year. Can you just allude to that and whether -- what we can expect for Q4? And then just regarding the shipment phasing from Q4 to Q1, given the lack of distributor stock-up this year, can you just give us an updated quantification on that? Thanks.

Yes. On the price/mix trend, I would say very much in line with what we expected, and we also referred to the price increases we have taken this year. So we took two in the first half and then we have taken a 2% in October. I don't really want to make comment on specifically for the quarter four let's say the pricing -- or the price/mix benefit. But we are seeing in general still in the Russian market positive mix. So we are seeing the upper end of the markets, whether it's in our business or the total market, super-premium, premium and other mainstream doing better, having better trends than the lower part of the markets. So that's still very positive. And then -- without talking pricing for next year, but assuming there won't be a price duty or a duty increase for next year, of course that will have a positive impact on what is required on pricing for next year. On the shipment phasing, if there's no duty increase, as we have said, we assume our distributors will not stock up to the same extent as they've done in the past, and of course will have a negative impact on volume for quarter four, but then a positive impact on quarter one next year. Sanjeet Aujla - Credit Suisse: Are you able to quantify that phasing?

As always you can go back and see what we normally talk about when we have stocking up before a duty increase. It's again distributors deciding how much they stock up or not stock up so I hate to give any or too much indication. But maybe it was minus close DKK1 million in volume actually.

Next question is from Soren Samsoe from SEB. Please go ahead. Soren Samsoe - SEB: Thank you. First a question regarding your mix both in Eastern Europe and in Russia. I think it was around -- your price mix was around 8% to 9%. Maybe you could quantify the exact mix effect and the maybe elaborate a little bit on the effect on mix also -- what you expect going forward in this high food inflation environment. Will people start to trade down and have you already seen some effect in some segments about this? That was the first question. Second question is regarding your market share development, how much of this is -- is it all driven by the strong marketing push you have done in Q3 or is some of it also driven by maybe some of the competitors having higher price than you or something like that? If you could elaborate a little bit about the movements in the market there. Thank you.

I can Soren. I'm not going to split price mix, so the 8%, 9%, into what is price and what is mix, apart from emphasizing again mix is positive. So it's not only price, mix is positive. We see stronger growth in the upper end of the market, super premium, premium. If we look forward, we still expect mix to be certainly minimum flat or maybe slightly positive. We still believe there's a lot of opportunity, even in tough times, to have a slightly positive mix or at least flat mix. So we don't see a high risk for down-trading in Russia, driven partly by modern trade where you can do a lot more category management, and modern trade is growing faster, but also us in particular but I would say the market getting more and more into multi-pack. That also drives or tends to drive slightly more positive mix. On market share developments, it's not only price promotion. I said earlier it's really also linked to innovations, it's linked to some of the sponsorships we have, how we activate those in the market, and some of the brands we are launching. But then again, look at trend line, look at the -- on a positive trend line was last year, that's where we want to be, but quarters can be always up and down. Soren Samsoe - SEB: Okay.

Maybe I'll try, Soren, because I know we touched on that last time after Q2 and we also referred to it this time round. In modern trade we are still seeing one kind of player still being behind on price increases. The rest of us more or less in line. So it's not like competition is pricing up more than Baltika. Soren Samsoe - SEB: Okay. And then finally just regarding the excise tax increase freeze in 2015. Could that also go into 2016 do you think? Thank you.

I think it's far too early to guess on and let's see first of all if the tax freeze or duty freeze for 2015 will be confirmed in the second reading. It still has to go through that second reading and third reading before it's finally decided.

Next question is coming from Nik Oliver from Merrill Lynch. Please go ahead. Nik Oliver - Merrill Lynch: Morning guys. Thanks for the questions. Just one follow-up on the Russian market share. I saw that the other segment was flat sequentially and in terms of share. And given your comments about premiumization, the discount end of the market being softer, do you think that segment has now peaked in terms of relative size in Russia? And a second question on M&A. Just given the weaker than expected current trading and I guess outlook for the Russian profit pool, has that changed your thinking at all on M&A in terms of diversifying into different regions etc.?

Nik, on other segment market share was -- again I've said many times I think we are close to seeing this other segment peaking based on some of the drivers for where they are today being retro-Soviet style brands. It's about draft in off trade and in some cases also about price. I think we're getting close to -- they have peaked. Is it [exactly] 22%, I don't know but over time I also expect the segment to come down in market share. That's all I can say. Nik Oliver - Merrill Lynch: Okay, thanks.

And Nik, on M&A, no, nothing has changed over the last quarter when it comes to how we think M&A. This is very much first of all about driving more value out of the business that we have and we think there's far more to do. And then if opportunities typically bolt on to where we are already pop up then of course we're looking at it. But we haven't changed anything strategically or so in our M&A thinking.

Next question is from Ian Shackleton from Nomura. Please go ahead. Ian Shackleton - Nomura: Yes, good morning. Thinking forward to next year and particularly the impact from FX, obviously we can do the translation element fairly easily but I was just thinking from a transaction point of view, can you just remind us to what extent you've got input costs in Russia in hard currency still?

There are -- as part of COGS in Eastern Europe there are some raw material categories, especially packaging material categories that are basically priced in ForEx, at least as a starting point. And then you can imagine that we're going whatever we can to get that exposure out of our COGS. And that is done by negotiation. I don't want to be precise on this at this point in time, 2015 we'll talk about in February, but of course we're doing whatever we can to minimize our ForEx exposure also when it comes to transaction effect. Ian Shackleton - Nomura: Just to be clear, on the raw materials, on the barley, it sounds like that should all be sourced out of Russia that will be locally sourced?

Was that a question? Ian Shackleton - Nomura: It was a question, yes.

Okay. But again we take all that in February. Ian Shackleton - Nomura: Okay. And just going back to the 2014 guidance, I think historically you've given us some of the other moving parts and I just wanted to check whether anything had changed. You talked about COGS per hectoliter being in line with last year and sales and marketing, especially on net revenue has been in line. Is there any change in those guidances for 2014?

No there are no material changes in any of our assumptions.

Next question is from Richard Withagen from Kepler Cheuvreux. Please go ahead. Richard Withagen - Kepler Cheuvreux: Yes, good morning. Two questions. First of all on Eastern Europe, you specifically mentioned the impact of obsolete stocks on operating profit. Could you perhaps quantify that and whether that could also occur again in some of the next few quarters? And second question is on CapEx. What is your CapEx view for 2014? Do you expect any major outlays for China given the recent acquisition?

When it comes to obsolete stock, basically what we are trying to say is that that more or less washed away the positive impact from better weather in September than expected going into the quarter. So it's not a huge number, not at all. And when it comes to CapEx, no changes at all again versus three months ago. That goes for Asia as well.

Next question is coming from Andrew Holland from Societe Generale. Please go ahead. Andrew Holland - Societe Generale: Yes, hi. Can I just clarify what is actually going on in Russia, because we're getting some slightly conflicting observations about the Russian economy from different consumer companies? And I'm just wondering, is it -- I think you said yourselves that people sitting in Moscow and St Petersburg are probably not too bothered about what's going on in Ukraine so is it imported inflation that's the problem? Can you tell us what food and beverage inflation is running at in Russia at the moment and can you tell us whether you think that's going to continue into 2015 and whether a lower oil price is also going to have an impact on how consumers spend their money?

Yes Andrew. If I start with the more specific part of your question on the food inflation. If we take year to date, food inflation would be around 9%, but if you take September in isolation it's probably more like 11%, 12%. So food inflation is high and it's coming up if anything based on more and more has to be imported. I think despite you see [indiscernible] Q2 consumer confidence is slightly up but we certainly expect that to come down again. So I think the consumer, the man on the street on average is not very optimistic about the future. They do see some employment being lost here and there so not a very optimistic consumer and we expect certainly not the climate to ease in the near term and neither in early part of 2015. Oil price, if it comes down and stays down of course it's never good for the Russian economy. But then again time will show how that develops over time. Andrew Holland - Societe Generale: Okay thanks. And could I -- I don't know whether I've missed it or whether you haven't given it -- can you say what your Russian volumes were in Q3?

Yes. Well we haven't said what our Russian volumes are. We say what Eastern European volumes are which is on page 25 of the release.

And you can say Russia is basically driving the Eastern European trend. There won't be a big difference. Andrew Holland - Societe Generale: Right. So I think you referred to 11% down in Q3 for Eastern Europe so we can take that as the same for Russia can we?

It won't be very different.

Next question is from Andrea Pistacchi from Citi. Please go ahead. Andrea Pistacchi - Citi: Yes, hi, good morning. Thanks for taking my questions. Two please. First on Chongqing Breweries, the consolidation benefit on EBIT seems to be a bit more substantial than previous. So I was wondering whether this is cost saving benefit starting to come through there, synergy benefits or rather phasing? And then if you could talk about the pricing environment in Western Europe. Your price mix was a bit negative. I guess that was depressed a bit by the good growth you got in other beverages, but if you could talk about the underlying pricing environment please, if it got any worse?

To the first question, actually we do not see any surprises in the inorganic part in Asia. It's very much in line with plan. So no changes, no surprises versus what we had expected previously.

And on pricing environment in Western Europe, I would say it's always tough. It's definitely not getting better; it's probably getting tougher in Western Europe. We would normally say in Western Europe we can get flattish to slight low, low single-digit benefit from price mix. That's in general what we believe. But I would say the trend, if anything, is slightly worse and getting tough on pricing and mix in Western Europe.

Next question is coming from Simon Hales from Barclays. Please go ahead. Simon Hales - Barclays: Thank you. Morning gentlemen. Just a couple of follow-ups really. Just going back to Trevor's question around the central costs in Q3. Clearly lower but obviously as you go into Q4, given the roll-out of BSP, as you said in the beginning of October in three new markets, should we expect a sharp pick-up in central costs therefore in Q4 perhaps ahead of the average year to date run rate by quarter? And then secondly just around your financing costs. The finance coupon in the period looked to be lower than I expected. Can you say what that was and how we should think about that finance coupon for the full year and as we look into 2015 please Jorn?

On allocated costs, I think the best way to think about this is, as we have said previously, it will be more or less the same on a full year basis, the same as last year. On funding costs, yes, slightly lower, so slightly lower coupon, but not very different from how we expected this to be three months ago. Simon Hales - Barclays: And what was the coupon in the third quarter on a blended rate -- a blended basis?

I don't think we have that in front of us. No hang on [indiscernible]. We -- Peter will come back to you on that one.

Next question is from Chris Pitcher from Redburn. Please go ahead. Chris Pitcher - Redburn: Yes, good morning. On the Russian price situation, you mentioned you've taken pricing up in October. I don't know if I missed it or not but could you say how much that was by and when the mix benefit from the smaller tax will be in the base? I'm just looking to see what the Q4 versus Q3 pricing development would be. Then in terms of the timing of the second reading, could you give us an idea when we should expect that? Because obviously we're getting later into the quarter and that limits the amount of time that wholesalers have got to stock up if it doesn't go through. And then thirdly on Poland, much better performance in terms of market share than I was looking for and with price mix broadly stable. Could you talk a little bit more about what's going on in the background for Poland which seems to have got a lot more competitive? Thanks.

Yes Chris on your first question, October price increase. That was 2%. And your question about price mix based on the downsizing of pack sizes. We started downsizing in the middle part, late part of Q1 and then kind of penetrated the market during Q2 and I would say more or less now in full in Q3. So that's how you -- that has kind of penetrated during the year. Timing of second reading on the duty increase we expect to be very soon. It could be this week, it could be next week. So it's very shortly we should expect to see the second reading of that. Poland, I hope you saw, those of you who attended the Capital Markets Day in Poland, why we are doing as well as we are doing in Poland. It is a very competitive market and of course competition always take action if they start losing market share. I think what we have built in Poland is a strong execution machine, strong leadership and also we have a nice brand portfolio of local regional brands and national brands and then we have some of our international brands doing extremely well like Somersby doing extremely well in Poland. So it's a mixture, but as I'm sure you all learned in Poland when you were down there, it's not driven by a discount customer only, it's very much also in traditional trade where we are performing strongly. Chris Pitcher - Redburn: But specifically on Poland, since we did the trip to the market, we've had your two big competitors announce quarterly updates where their price mix in Poland has been down mid to high single digit, a significant deterioration. And I'm just wondering if that is a deterioration versus what you were seeing beforehand and whether you can continue with your performance in light of that change?

We do not expect a very different performance as we are seeing now in Poland. So a kind of flattish price mix in the current market environment with the portfolio we have we believe we can probably continue. Can we continue the same volume growth versus market growth because are very strong so far? Time will show but we believe we can on average beat market development but maybe not always with the same kind of business as we do now. And it's volume and its value so it's not based on price, just taking down price. It's volume and value following each other.

Next question is from Tristan van Strien from Deutsche Bank. Please go ahead. Tristan van Strien - Deutsche Bank: Good morning gentlemen. Three questions if I may. The first one just a clarification from the earlier question on obsolete stocks. Is this just an advance planning issue or is it also about portfolio mix or innovation that didn't quite work out or anything on those lines? The second question on the big movement in working capital. You talk about seasonality. If you could just expand that a little bit, since I assume you're comping the same season, and whether you are really giving out more trade credit during the period? And then lastly on India, could you give a bit of color on that? Which states really drove that performance in the last quarter? Thank you.

On obsolete stock, it's -- you can basically exclude innovations. So it's much more on the traditional portfolio and it is [indiscernible] that in a market that is declining as it as the moment it is just very difficult to have at all points of time the right products in the right warehouses all over Russia. So it is just that this market decline as such is putting a lot of -- is stretching supply chain effectiveness as such. But, as I said, it's not a huge amount in the third quarter. Tristan van Strien - Deutsche Bank: Your current distributor stocks are pretty much in line with your sales at the moment or is there a mismatch there at the moment?

No we of course -- we think that the stocks are matching our expected sales for the coming months at all points in time. And of course you can get that slightly wrong and that would then eventually lead to that you need to write off some of those inventories. But I said it was not a -- it's a big -- the big event in the quarter. When it comes to trade working capital, as I also said, our 12-month moving average trade working capital to net revenue improved from last year minus 3.5% to this year minus 3.7%. So it is basically driven by the top line growth, this minus in trade working capital for the quarter or for the first nine months.

And then your last question, I'm not sure I understood. You talk about what was driving the -- Tristan van Strien - Deutsche Bank: Yes which states did you perform well in India.

Are you talking about in India? Tristan van Strien - Deutsche Bank: In India, yes, it's a big country. So which states.

Okay. I would say in general all over because it's really driven by our international brands, so Tuborg and Carlsberg. Yes we are stronger in some states than others and maybe slightly better in general in the northern part of India than southern part of India. But it's really all over basically.

Next question is from Jonas Guldborg Hansen from Carnegie Bank. Please go ahead. Jonas Guldborg Hansen - Carnegie Bank: Yes, good morning. A couple of questions from my side. Could you -- you saw very good performance in Indochina. Could you put some color on what is driving this performance? And then secondly just if you could remind me on what is driving the logistic costs in Eastern Europe? And finally, the delisting of unprofitable SKUs in China, for how long could we expect these to affect organic growth?

I can say the first and the third one and then Jorn can talk to logistic costs. On Indochina, when we talk Indochina it's really Cambodia, Laos and Vietnam and I would say all three markets do very well. Cambodia, Laos, from a market point of view in terms of market growth but also outperformance within it. As you know, we have a very, very strong position in Laos. Can we keep driving market growth? We tend to benefit with a 98%, 99% market share and we also have some very strong launches lately. In Cambodia it's very much our local power brand Angkor Beer, and then strong share and also strong market development. Vietnam really strong performance so market share gains. Again here we have had -- on the Huda brands a very strong launch of a new line extension and a key driver in Vietnam of our performance. On China, your question was about the SKU rationalization. You've seen most of the impact in this year because we did it early part of this year, rationalized the SKUs. There could be a little coming into the early part of next year but mainly this year. If we don't decide to do more rationalization at a later point in time and you always have to sometimes rationalize your portfolio?

And on logistics, it is, as you also saw after Q2 we have high logistic costs in Russia this year or in Eastern Europe this year, which is one element which is high tariffs. And then it is also again optimizing, as we talked about before actually, because it also links somehow into inventory management. We are moving more volumes around at the moment than we ideally should, which again is due to that it is -- when it comes to demand planning it is demand planning. It is -- it has been a difficult year also with the market development that has been, as you also know, a bit different from what we actually expected going into the year. But all that we are working on improving and that we think we can also kind of thinking this into next year.

Next question is from Hans Gregersen from Nordea. Please go ahead. Hans Gregersen - Nordea: Good morning. A couple of questions. Let's kick off with Western Europe. In Poland you mentioned your fit program which I understood should drive let's say around one percentage point share gain over the next couple of years. Could you give some further insight into how this will be executed and implemented? That's the first question. Second question. If we look towards Russia on the price mix you have announced 9% for the quarter. Can you break down how much is coming from let's say the pack resizing effects where you can say lower volume higher stable pricing, and what's left for the rest? And then finally, have you seen no price increases from Efes in the modern trade during the quarter? Thank you.

Thanks Hans. On the Western Europe and the fit program being basically about how to really prioritize what we do in the outlets and then how you monitor and follow that up. Yes it will have a positive share impact and as quoted by I think our head of Western Europe, over time could main we gain one share point in Western Europe. It's rolling out in all key markets and supported by the region. And I think we are now in probably 3 to 4 markets with the program but we keep rolling out and keep being improved. On Russia price mix, I cannot and I do not want to split price and mix and downsizing but we have said what we have done on pricing and then you can do your calculations. Hans Gregersen - Nordea: Could you then say how much have you on average reduced the pack size?

I think we said last time, and I certainly repeat that, if you talk about downsizing, of our total volume approximately half of that we have downsized, and you can say we have downsized by 4% to 5% on average on the different pack sizes. On Efes, and I will only base my comments on what I see in Nielsen data and if I look at modern trade year to date, their pricing on average is not up a lot. Hans Gregersen - Nordea: And year to date how far up is that?

When you say Efes specifically or -- Hans Gregersen - Nordea: No you said the AC Nielsen data. How up to date are they?

They are pretty much up to date so we have September data. Hans Gregersen - Nordea: Thank you.

I think we can take one more question, last question.

Last question is coming Frans Hoyer from Jyse Bank. Please go ahead. Frans Hoyer - Jyske Bank: Thank you very much. I noticed the BSP1 program and the cost effect on the P&L. Could you talk about the benefits and how you see them building up so far and at what point more specifically over the next several quarters do you see the benefits matching the level of costs please?

In general there's no changes when it comes to how we think costs nor benefits from the BSP1 program. So it is all in all quite neutral to the business this year. Next year where we will have basically from end of Q1 more or less all scale markets in Western Europe on the platform; we of course should start to see more benefits than costs. And then if you think 2016, more or less all markets are on the platform and no more implementation to do. And then of course that would be quite different from what you're seeing this and next year. Frans Hoyer - Jyske Bank: Thank you. Thanks very much.

I think we will have to finish the call here but again thanks for dialing in and as always speak to many of you in the coming days. Thanks a lot.