Cees 't Hart - President and Chief Executive Officer Heine Dalsgaard - Group Chief Financial Officer

Simon Hales - Barclays Jonas Guldborg - Carnegie Michael Rasmussen - ABG Sanjeet Aujla - Credit Suisse Soren Samsoe - SEB Edward Mundy - Jefferies Carl Walton - UBS Trevor Stirling - Bernstein Andrew Holland - Soc Gén Tristan van Strien - Deutsche Bank Alicia Forry - Liberum

Ladies and gentlemen, welcome to the Q3 2016 Trading Statement Conference Call. Today I am pleased to pressed Carlsberg’s President and CEO, Cees 't Hart; and Group CEO, Heine Dalsgaard. For the first part of this call, all participants will be in a listen-only mode. And afterwards, there will be a question-and-answer session. Just to remind you, this conference call is being recorded. Speakers, please begin. Cees 't Hart: Good morning, everybody, and welcome to Carlsberg’s Q3 2016 conference call. My name is Cees 't Hart and I have with me CFO, Heine Dalsgaard’ and Vice President Investor Relations, Peter Kondrup. I will now go through the highlights of the Q3 as well as our progress on SAIL’22 and our preparations for the future. And Heine will talk you through the regions, the progress on Funding the Journey and the outlook. Please turn to Slide 2. We delivered solid performance for the quarter and we are satisfied with the progress so far this year. Organic net revenue grew by 1% driven by 1% price mix and flat volumes. Price mix was lower in Q3 compared to the run rate for the first half year due to growth in license volumes in Western Europe and the expected lower price mix in Eastern Europe in the second half of the year. Total volumes were flat as a strong volume growth in Eastern Europe was offset by the expected lower volumes in Western Europe and Asia. We upgrade our earnings outlook for the year due to the uplift in volumes in Eastern Europe in Q3 and good traction behind our volume management efforts. All in all, we are pleased with our results so far this year as we are confident with the progress of Funding the Journey and SAIL’22. Please turn to Slide 3, and a few comments on our strategy implementation. Overall, SAIL’22 has got off to a good start. Funding the Journey is the main priority of this year as it’s progressing well. And we are on track with our plans. But also for the other parts of the strategy, we start to see the priorities come alive in the plans for 2017. On deliver value for shareholders, we are on track and today’s adjustment of the earnings outlook supports this. I will go through the progress of Strengthen the Core and Position for Growth on the next slides. Please turn to Slide 4, and Strengthen the Core. As part of leverage our strong growth, we welcome assuring that Golden Triangle is embedded across our markets. The Golden Triangle is about getting to optimal balance within volumes, GPaL margins and EBIT. It is mindset change that our local operators have picked it up fast and it is working well. Prove of that is the good price mix development in Q3 across our markets. A lot of work is currently going on into developing and rolling out tools and principals to improve and renovate the brand fundamentals of our core brands and create stronger and more streamline portfolios. The key element of this priority is also to focus our resources, management as well as cash of fewer activities and doing in more impactful. Hence we are working on reallocating AMP strength and as part of Funding the Journey; we have disposed non-core businesses and restricted activities. Danish Malting Group, Carlsberg Malawi and U.K. Logistic Operations are good examples of such initiatives carried out this year. Even though Russia only accounts for 60% of Group operating profit, it is still our largest market, under this therefore single doubt is a specific priority within the Strengthen the Core pillar. The focus in Russia this year has been to execute on a stronger commercial agenda and build further on this in the years to come. In 2016, we just made a number of changes including the repositioning of the Carlsberg brand which has delivered very positive volume and value result so far and we have intensified our focus on the growing segments and channels including the so called DIOT. In order to be successful with our more attractive as streamlined brand portfolios, there was also a need to step up our executions, capabilities, at point of sale, as well as our digital capabilities. We have this year focused on building these capabilities among others by hiring new people. In 2017, we will be able to communicate more firmly on the changes and how we have improved our execution. As Heine will come back to Funding the Journey in a few minutes, I will now just confirm that we continue to see good traction behind progress. Please turn to Slide 5, and our growth priorities. As a result of our strategic evaluation, we have chosen three areas which we consider the most attractive growth drivers for the Carlsberg group. These are expanding our presence in the growing categories of craft, specialty and non-alcoholic beer, expanding outside of our current markets by selectively targeting big cities in new geographies and continuing to grow our business in Asia. Within Craft & Specialty, out ambition is to deliver great brands for the many and not for the few craft share. In 2016, we have further strengthened our long standing corporation with Brooklyn. We opened up the E.C. Dahls brewery in Norway, which is a replica of the successful New Carnegie brewery in Stockholm that some of you visited a few weeks ago. From January, we will be distributing Brooklyn in the U.K. and finally we are brewing the brand on license in Europe. With respect to our international specialty brands, we are increasing the availability of Grimbergen and 1664 Blanc. Grimbergen continues its strong performance those in existing markets with also in the new markets where the brand is launched and it grew 11% year-to-date. In the lower end of the craft specialty price, we are leveraging our strong local brands by launching crafty line extensions Koff APA in Finland and Carlsberg Blue Master Collection in Demark. Within NAB, we believe that our strong R&D capabilities which includes the largest and world leading yeast library give us a competitive edge. We already have a number of successful non-alcoholic liquids to build upon. Examples include Carlsberg’s Nordic which earns 43% of the NAB segment in Denmark, and had driven a 33% capital growth this year. Baltika 0, this a 60% market share of NAB in Russia, growing almost 20% this year. And finally Tourtel Twist in France which in only two years has obtained more than 1% of the total French beer market. On big cities, we now have a dedicated team in place and based on detailed analyses they are finalizing the plans for and how to enter a selected few cities next year. In Asia, we launched Tuborg in Vietnam and Cambodia earlier this year and we are building a new brewery in India to support our positive momentum in this market. In China, we achieved value growth on the back of the ongoing premiumisation which particularly is a result of a growth of Tuborg and 1664 Blanc. In Vietnam we are in the current privatization process related to Habeco. As you may know we have had an MOU in place since 2009 which grounds us a first right of refusal. We are not able to more complete at this point in time, but we will of course come back to you at the later part. Although these activities are just examples to illustrate how we continue to drive growth Asia. In conclusion, we are pleased with the progress of the strategy. We see the priorities being reflected in the 2017 plans and we are on track to deliver on our financial commitments. I would now like to hand over to Heine Dalsgaard, who will comment Funding the Journey progress and the 2016 outlook. Heine?

Thank you, Cees and good morning also from me. Slide 6 please and a few comments on the Western European results in the quarter. We estimate that the overall beer market grew slightly. Our net revenue was down 4% reflecting a total volume decline of 4%. The volume decline was an expected. As we indicated at the Q2 conference call illustrate the last year’s reduction of margin dilutive contracts in the U.K. and Poland and in Finland and further compounded by destocking in July after the Euro Football Championship. Price mix was flat. The lower price mix in the quarter versus the first six months was mainly due to strong performance of the Tuborg license business in Turkey where we only include the license income in net revenue. Excluding this, price mix in Q3 was 3% which is in line with first half. All in all, we are pleased with the value management efforts in Western Europe and how the Golden Triangle is being adapted across all our markets. In the Nordics, we saw slightly growing beer markets and we grew volumes by 1% in Scandinavia, while volumes declined in Finland due to last year’s withdrawal from supply contract. We saw particularly good result with our premiumisation efforts craft and specialty continued to perform well. In France, our volumes were flat as we were impacted by the destocking in July. Throughout the year, we have been gaining market share in the on-trade channel which we have lost market share in the off-trade. The total Grimbergen, Skol and Brooklyn brands all delivering very good results and growing by double-digit percentages, whereas our mainstream brand declined. In Southeast Europe, our business in Bulgaria is delivering strong results driven by growth of our local power brands. The turnaround of the U.K. business is progressing well and we have now announced the outsourcing of the porterage and logistic business. Volumes and market share were down due to last year’s loss contract. Adjusting for this, our market share was flat. Price mix developed very favorably at high single-digit percentages as a result of the reduction of low price volumes and also our premiumisation efforts. From January, we will strengthen our U.K. portfolio with the addition of the Brooklyn brand. In a flattish Poland market, we were able to reduce - we reduced our presence with promotionally priced big formats in the modern trade in the beginning of the year. This had a positive impact on price mix but a negative impact on volume. The market in Poland remains very promotional. Slide 7 please and Eastern Europe. We estimate that the Eastern European market were flat for the quarter as they were positively impacted by very warm weather in Q3. Underlying the market remained challenged by the weaker market economic environment. Our net revenue grew organically by 16% as a result of 5% positive price mix and 10% volume growth. In Russia, our volume growth in the quarter was in the mid-teens as a result of improved commercial execution, market share gains also warm weather and the selling of large sized PTE bottles. We will in Q4 adapt to the new PTE regulation, which means that we in Q4 will face out all PET bottles above 1.5 little to be ready for the plus 1.5 and effective from January 1st. Consequently, we shipped extra volumes in late Q3 to ensure availability at wholesalers and all the retailers during the transition period in Q4. Looking at our commercial results in Russia, we saw a positive performance in a number of key brands including Baltika 0, Shumensko and also Carlsberg. The price adjustment on Carlsberg which we did early this year had delivered very positive results both in terms of volumes but also profitability. Finally, we continued the further expansion into the dive channel. Our quarterly market share grew both sequentially and also year-on-year reaching now 35%. Year-to-date, our share is still slightly down. The market share growth was mainly in the modern trained channel. In Ukraine, we grew volumes in a declining market. We thus gain market share and this was driven by good performance of Lvivske and also Garage. Slide 8 please, and a few comments on Asia. The beer market development in Asia was mixed with continued growth in most markets, which we estimate that the Chinese market was flat for the quarter. Our regional net revenue grew organically but 2% as a result of 4% price mix as volume were down with 1%. Reported net revenue declined 6% impacted by the negative currency impact and the disposal of Carlsberg Malawi. We achieved volume growth in India, and Nepal, and Laos, and Myanmar, while volumes were down in Malaysia and China, as a result of the Eastern Assets brewery closures. A few general remarks on China where the market value growth continues at the premium segments show a much better development at the discount and the mainstream segments. We are in the process of deemphasizing our discount offerings and also reallocating most important towards our premium portfolio. We have one of the strongest international premium portfolios in China with brands such as Carlsberg, 1664 brand and most importantly Tuborg. Last year, Tuborg reached an impressive milestone becoming second large international brands in the country. For Q3, our premium brands grew by 8% and they now account for more than one third of Chinese revenues. Tuborg grew by high single-digits and 1664 almost doubled. This also supported a strong performance in price mix which in Q3 was 5%. Outside China, our Asian business grew volumes by 4%. India continues to perform strongly and achieved 20% volume growth in spite of the alcohol ban in Bihar. Also here Tuborg remains an important driver of the growth. We achieved a record high market share in India in Q3 of 19%. Vietnam and also in Cambodia, we launched Tuborg earlier this year. So far the results are encouraging. Please turn to Slide 9. Our Funding the Journey initiatives are on track and we still anticipate to realize around a quarter of these benefits this year, we are especially pleased with the performance of our value management efforts and the focus on the Golden Triangle throughout the organization. Delivering of this product has turned out to be achieved to slightly faster than originally anticipated. Within supply chain efficiency and OCB, our progress is exactly as expected. In terms of rightsizing of our business, it has been a busy year as we have carried out rather extensive restricting plan. As a result of great growth by out Chinese team, we have managed to close down 11 breweries in China and sell five sites. We have close down production lines in Russia and in the U.K. and on October we made the final decision to outsource porterage and secondary logistic business in the U.K. Finally, we have sold a number of non-core businesses in order to refocus the business on our strong holds. On top of the already mentioned disposals, we have recently sold our minority stake in site which is a Danish based plant breading company. We’re still looking at a small handful of assets that potentially could be disposed. In addition hence on a completely different note, I always want to briefly mention that we have 300 million sterling bond that matures in November which will be refinanced with cash. Finally, please turn to Slide 10 and the outlook. 2016 has been an important year for us as we have focused on realizing the benefits from Funding the Journey and embedding an implementing SAIL’22. As mentioned earlier, we are progressing on both initiatives. Mainly as a result of good performance in Eastern Europe in Q3 and supported by faster than expected results of our value management approach, we now expect to deliver an organic operating profit growth of around 5% compared to previous low single-digit. Based on the spot rates as of November 7, we estimate that the full year translation impact from FX will be minus DKK550 million compared to previously an estimate of minus DKK600 million. The DKK50 million improvement is mainly because of the strong Russian ruble, all other assumptions in our outlook remains unchanged. Cees , back to you. Cees 't Hart: Thank you, Heine. Before I open for questions, let me summarize the third quarter in a few words. We delivered solid Q3 performance and saw a good traction on our chance supposed to value management. The delivery of the Funding the Journey benefits and the implementation of SAIL’22 is on track. And finally, we are able to adjust earnings outlook for the year. With that I would like to open up for questions.

[Operator Instructions] And our first question comes from the line of Simon Hales from Barclays. Please go ahead. Your line is now open.

Thank you and morning gentlemen. A few questions please. Firstly, just on Western Europe in terms of see the destocking you saw in July. Can you talk a little about the shape of the quarter more volume perspective overall how things perhaps improved underlying in terms of consumer of trade through August and September? Secondly on Russia, clearly you’ve talked about the stock build at the end of Q3 ahead of the PET ban coming in. Have you got any flavors to how much of a benefit there had on volumes in the third quarter? And also did you see any impact at all from the alcohol registry system changes to smaller outlets coming in Q3 at all. And then finally with regard to the outlook for 2017 as in comments I think you’ve made on Bloomberg this morning about expectations for volumes down 4% to 5% in Russia next year, which gives you little bit more detail if you're thinking behind that? Cees 't Hart: Good morning, Simon, thank you very much for your questions. With regard to Western Europe, regarding the shape of the quarter we have indeed bit of a slow July as we commented on when we were discussing the first half here. Then August was a good month and September was an excellent month, so in that respect we saw a good let’s say a shape of the quarter after a bit of a down July. With regard to the stock buildup in Russia, we have three days more stock in the trade, especially focus on the PET of 1.5 liters, so that's what basically improved a bit our volumes in the quarter as well. We don't see to our delayed that much impact yet on the alcohol register system the EGAIS system. Talking to the Russian management that we might expect some black market overtime because of this, but frankly we do not see any negative so far. With regard to volumes expectations the minus 4%, minus 5% is basically assuming the overall decline in the market is bottoming out a bit however we will have the impact on the ban of the one half plus PET bottle, and that's will be factored in and came to the kind of assumption for next year.

Perfect. Thank you very much.

Thank you. Our next question comes from the line of Jonas Guldborg from Carnegie. Please go ahead your line is now open.

Yeah good morning, thanks for taking my questions. First of all staying with Russia here how much of the volume growth in Eastern Europe is driven by this reposition of the cost per brand? Then also on Western Europe is it do I hear you correctly when the difference between the adjusted volume development of minus 1% for you and the plus 1% to plus 2% for the market the difference between these two numbers is than the destocking? Yeah that would be my questions. Thank you. Cees 't Hart: Okay I'm not sure we captured so well your second question. With regard to the volume growth of Carlsberg we will not be quite specific on that one. We see that the volume development of Carlsberg is picked up by Nielsen already as well. So we see a good share developed of Nielsen, which is allied for us of course we’ve repositioned to the brand in terms of pricing and see after having years, having had years of Carlsberg being a very tiny brand now one of our successful brands in Russia. Can you repeat your Jonas your second question?

I'll try again. You’re right that in the quarter your volumes adjusted for the for the low margin contraction U.K., Finland and Poland are down 1% while the market is up 1% to 2% this loss of market shares that only due to the destocking effect from the huge 2016? Cees 't Hart: It's a combination of course, but basically if you would correct our European figures for the contracts which were stopped then we would increase our volumes by 2%. So the impact of three is at 2%, when you talk about loss of market shares mainly in France in the half rate after basically a very big promotion in one of our competitors. However on contract we are gaining market share. So in that respect a mixed picture in France. In general, we feel that we are fine with regard to our balance between market share, depot and EBIT.

Okay, thank you. Cees 't Hart: Thank you, Jonas.

Thank you, our next question comes from the line of Michael Rasmussen from ABG. Please go ahead. Your line is now open.

Thank you very much. First of all, could you tell us a little bit about the volume impact from Turkey, how much that the exported license volumes grow on the back of what you saw in the quarter, and this is something we should expect in the quarters to come? On special items for the full year as I understand that the extra breweries sold in China will have a small impact, but can you give us a rough guidance on where we should be full year, I see the consensus average is for DKK86 million in 2016? And then finally on the U.K. in terms of outsourcing the logistics business, can you give us kind of any size on the revenue EBIT and potentially invest capital impact from this outsourcing? Thank you very much. Cees 't Hart: Okay. With regard to volume in Turkey, Peter will come back to you. And the other a mix effect as we explained, but Peter will you the details. And with regard to special items I’ll hand over to Heine.

Good morning, Michael. So you know our words with special items would not give any specific guidance on special item, so you're right there are some minuses in that, but definitely also in plusses. So in terms of how special items look for the full year it's not something we guide on. Sorry, and then the last question in terms of impact on revenue for - so in terms of the impact from the outsourcing of the U.K. business it's relatively - it's relatively limited. It's not something we comment on specifically.

Okay.

Okay, thank you. Our next question comes from the line of Sanjeet Aujla from Credit Suisse. Please go ahead. Your line is now open.

Hi couple of questions please. There's a case when you think about the minus 4% to minus 5% volume decline in Russia for next year what assumption are you making on how much of the PTE volume in larger pack sizes migrate other packaging types? And can you just remind us of the gross savings you’ve communicated 25% or roughly quarter this year, how much of that is reinvested in 2016, please? Thank you. Cees ‘t Hart: Okay. With regard to your first question the PTE bottles, that has an impact for next year, our assumption is that more as 40%-50% will come back to our volume and the rest of the volume will be like a lost. That’s the assumption we make. As you know, it’s very difficult of course to estimate. But that’s what we have in our plans.

I guess in terms the gross savings, you are absolutely right, but what we’ve said is that out of the 1.5 billion to 2 billion, we see approximately one quarter coming through this year. The reinvestments in to sales went into two initiative this year is relatively limited. The way we see it for good reasons because he launched SAIL’22 earlier this year, so we’ve mainly now working on the plans. There are some investments to the tune of below 100 million.

?: Cees ‘t Hart: Well, if you look at what our proposition is do below the 1.5 liter, this have a higher margin. So the confidence of that is that it would be good news that the consumer who will move to the lower sized, but higher margin propositions. On the other hand of course, we anticipating more or less 45% of the PET bottle market or segment is in 1.5% plus. So in that respect, we feel that that will be again have be some volume loss but to the tune of 40%-50% but then move then on to the other proposition this margin enhancing indeed.

Understood. Thanks.

Thank you. Our next question comes from the line of Soren Samsoe from SEB. Please go ahead. Your line is now open.

Yes. Good morning. Just first question regarding, you mentioned in the first bullet on slide 4, that Golden Triangle is relating into modern improvements, but if you could maybe elaborate a little bit on how and where this works, I mean give us some more concrete examples of what has actually happened and also whether you’ll see an equally big increase in cash flow? Then second question relates to Russia and the market share gain, you talk about I mean if you could tell us a bit more, is this broadly based or is it mainly related to Carlsberg and Skol , Lvivske brands. I remember you mentioned in Q2 that brand to get three and I think there was one other brand that was not going well. If you could tell us whether this has improved - I think it was Tuborg as well that was not going well in Q2, but is it more broadly based now that the market share gains you see? Thank you. Cees ‘t Hart: Okay, thank you very much. With regard to Golden Triangle, we have made decisions for example involved in Poland as we communicated earlier, Poland and Finland based on the Golden Triangle. And by that we have less volume and higher margins. One of my positive surprises in Carlsberg is that at the moment as we introduced the Golden Triangle, the operators were very quickly on the feet was implementing it. I’ve asked them to comment every on their results and specifically on the improvement on the Golden Triangle. And do it months after months. And we see that the consequence on that in our margins coming through. The first half year as you recall, it was on the 40 basis points increased in margin. So I think we saw a well wizard concept, obviously everywhere we need do complete and balance it in the triangle, we should not move immediately that now from volume to its only value. So we are balancing that over months to months in our mostly performers issue. So it’s - I can give you the examples especially from Finland and Poland which directly were the consequences of the golden triangle, the rest is basically in each country they are getting the balance. First in the portfolio but then later on and that’s what we roll out now in the program and as well for customer. So it’s goes deeper down only let’s say the overall picture of deeper market share and the profit. With regard to the Russian share gain, maybe first to make you aware of or to remind you towards Q2 2016 in Russia where we may be increased our prices by I think 14%, that moment of time was not followed by our competitors, but - the high price premium on the shelf in the modern trade and our market share declined towards something like 33.5%. And we’ve said earlier that modern trade was not very well represented in our business in terms of professionalism, we have changed key account management in Baltika. We’re now much more focused on being more professional in at approaching the traditional order the modern trade. And by that we see an improvement. Carlsberg indeed has really contributed to that as well. We see it overall the portfolio on Baltika 3 and the other words Baltika 7, we feel that we should do better. For that we have new plans for the next year. Baltika 0 has very well worked for us in terms of market share. So in general, we’re happy with the market share especially in the modern trade because that’s the fastest growing as general in Russia at this moment of time. And with regard to the overall performance of Baltika brand, it’s a good performance but we want to do that even better next year.

Just a perhaps, just a comment on the cash you also asked about. It’s clear that the Golden Triangle is it’s a way of working. It’s a way of working where we ensure the right balance between volume and value. And it’s very clear that the positive impacts we see on EBIT goes through to the cash flow as well. So there’s nothing in here sort of that doesn’t translate into case except of course the difference between organic and reported. But in terms of the reported EBIT, we will see the same benefit on cash.

Okay. That’s nice, nice to get a confirmation on that. Thank you.

Thank you. Our next question comes from the line on Ed Mundy from Jefferies. Please go ahead. Your line is now open.

Hi, morning. Three questions please. You mentioned that using the Russian market on bottom out if you back out the PET ban. Just really a comment that starts approval, do to feel the capital fall into a level where you start this coming back? Secondly, on your big city strategy, I don’t you will be able to comment as to whether you’ve got the sales teams in place and have you found the right partners for the asset light strategy? And then lastly on Funding the Journey and facing of the benefits, I think you mentioned that you’re seeing the benefits come to slightly faster than anticipated. Could you remind us of the waiting for 2017 and 2018? Cees ‘t Hart: Yeah. Well with regard to the Russia market, yeah if you look at it from a longer term perspective, the market quarter-after-quarter came down by double-digit decline percentages. And we see now that it’s single-digits than even in the last quarter 0.5% positive. So in that respect, we feel that is moved out. The consumer confidence has not improved. But we think that at a level that’s within the equilibrium between the consumer confidence and let’s say the confidence they have. Again the 4%-5% decline for next year is mainly in the shift of PET bottle, that’s bit now. On the other side, in Russia, what we’ve seen over the last couple of years is that the excise duties went up significantly. We now know that for 2017, there will be only bond between that only, but vulnerable increase and then there is a kind of break as it seems now for another two years. So in that respect, it’s transparent what we can expect. Then the excise threat is over for the coming three years. We know what the system has done to us. That’s not a lot of impact what I said earlier. And in that respect the bigger slightly known is the PET volume downsizing. So in that respect, we - if there are no other big let’s say surprises in Russia with regard to that has an impact on the consumer confidence, we feel that this is more or less what we can expect for 2017. With regard to the big cities, you appreciated, we don’t say too much at this matter of time. When we start to hit the markets of the cities then we will update you immediately. Of course we are in preparation. Yes, we have found a few partners which are excited by our plans. We have I think a very good team that is really building fast - building a faster plans and I think by let’s say June next year we should be able to comment more on where we have landed our first operations. In terms of the facing of Funding the Journey benefits it's clear that this is not an exact sign, so what we see in terms of the DKK1.5 billion to DKK2 billion is approximately one quarter this year and more they can next year let's say around half of the total benefits and then the remaining of it will come in 2018, it's important to say that this is of the DKK1.5 billion to DKK2 billion the facing of the net impact so half of that so what goes to the bottom line is different, because of the fact that it does take time to ramp up our SAIL’22 initiatives. So half of the benefits would be invested into SAIL’22 that was launched earlier this year and so simply the facing of that is more towards the latter part of the period.

Thank you.

Thank you. Our next question comes from the line of Carl Walton from UBS. Please go ahead. Your line is now open.

Yeah, thanks for taking the questions. Just a few from my side, one on Asia, can you give more color on Vietnam or Vietnam and Cambodia growth rates presumably it was more in line with the kind of market growth rates in the third quarter, is that right, given what we have enough cycle, I think destocking that are you seeing in the first half? Second question is just a follow-up on the big cities clearly you can't say, which city is your moving into before June as you say, but if you are willing to share anything in terms of just now that the plans are in place without specific cities being mentioned, how you’re thinking about specific targets on market share gains or how quickly you expect them to really sort of execute on the rollout plans you have there? And then the last one just on the news last month around Kirin’s stake in Brooklyn obviously your comments competitive to taking a stake in a partnership distribution agreement you have is there anything you can comment on how you see that or whether you know you anticipate any sort of impact from that strategically with your partnership? Many thanks. Cees 't Hart: Okay, thank you very much. With regard to Asia and Vietnam, Cambodia, in Cambodia we have gained share significantly over the last five years, we have lost some momentum in Q2. Q3 on the back of distributor reorganization is an increase in price competition. However, the two more brands were successfully launched in Q3 so as we speak and already achieved 40,000 hectoliters sales. Q4 outlook is stronger as new distributors that in Tuborg brand expansion this region the footprints. So in total in Cambodia we are bit disappointed about Q2, Q3 and we are excited about the first success of Tuborg brand and purse at further. Volumes [ph] in Vietnam are flat in Q3 we help share in Q3 we were basically growing slower than some of our competitors as we are exposed to lower gross Central Provinces as you know so it's a footprint issue. However we gain premium share with the successful launch of Tuborg that again after or together is Cambodia is an excitement development. And we see rapid growth for who that goals in the none that’s the third city in the Heartland or some of our - of one of our competitors. So in this fact that's a bit of a mixed picture, but with the Tuborg launch we are excited about the progress there. With regard to big cities again we will not comment on that too much. Just to make sure that we manage your expectations and we said at earlier it will be a bit of a slow burner. We're going to pilot for five big cities across the globe in 2017. We will learn from that and then scale up and we will do that indeed as of light, but I think some of the other initiatives like NAB and Carlsberg specialties which are important part of our SAIL’22 will have faster and a more significant impact on our plans in the coming two, three years than big cities that's again that's a bit of a slower burner in the direction of 2019, 20120. Kirin stake in Brooklyn, well we have a very good relationship with Brooklyn and this is the kind of context and contracts that we have, we got what we want, and we continue that even expanded that in Europe and we start now in the U.K. is distributing lots of distribution of Brooklyn so in that fact we did not see region to make another approach to towards the Brooklyn then continuing and even enforcing to kind of contracts and context that we have.

Very clear, thanks.

Thank you. Our next question comes from the line of Trevor Stirling from Bernstein. Please go ahead. Your line is now open.

Good morning Cees 't and Heine, two questions from my side please. First one is you mentioned that there was a stock build towards the end of the Q3 in Russia, should we be expecting further stock build in Q4 headed the PET transition. And the second question in terms of scope and metro acquisitions, there is roughly a 1% drag at a group level from Asia presumably from the lobby should be expected that to continue not in next three quarters? Thank you. Cees 't Hart: Trevor, thank you. Good morning. With regard to the stock level, no we should not expect this for Q4 because we're not allowed to ship one half liter plus PET bottle anymore to the trade. So we should be drive like by the end of this quarter. So no stocks build on Q4 in that.

And in terms of the divestments in Asia they approximately minus 1%, you ask that right that it comes from Bellamy [ph] and you also write that that you can expect to continue for the next quarters as well.

Thank you very much, gentlemen.

Thank you. Our next question comes from the line of Andrew Holland from Soc Gén. Please go ahead. Your line is now open.

Thanks very much. A couple of questions actually just picking up on that last answer from Trevor’s question, you're saying you're not allowed to ship in Q4 one and half liter PET, can you tell me what's behind that? Second one is can you give us any clues on the timetable or possible timetable for the Habeco transaction if that transact? And thirdly simply because it's rather timely can you tell us if you think you've got any likely impact from a Trump victory? Cees 't Hart: Okay, thank you. Thank you Andrew good morning. And maybe I'm not being clear enough, but it's not about that we're not allowed to ship in Q4, but we're not to allow to ship in Q1 next year anymore, so everything that run to bring to the markets needs to be done in Q4 in terms of one half liter plus PET, and that means that we should not have any stock by the end of this year in one half liter plus otherwise we cannot ship to the markets anymore, and basically will have a problem there. So we are phrasing that out. And as we speak or another even producing the one half liter plus any more in order to prevent that we have stocks that we cannot ship anymore. So it’s in military action if you like in order to make sure that the pipeline dries up, and then we get now our new 1.4 liter propositions into the markets by the end of this year.

In terms of the question on Habeco of course you know that would never comment on ongoing negotiations. We are in a dialogue with the Habeco that we signed the MOU as you know in 2009 and that MOU contains first right of refusal. But we'll come back to you what we have something more concrete, but we will not give any specific comments as for now also not on timing. Cees 't Hart: With regard to the outcome of the elections although I fully understand your interests, we never comment on election results, and it will not make an exception. Today the U.S. voters have spoken I guess we should all respect that.

Okay. Thank you. Just one follow-up, just related to your U.K. logistics disposal, just unclear on that that is your business that delivers direct to pubs is that what you sold? Cees 't Hart: Yes it is. And you know we sold this business as part of sort of the recall rent restructuring plan of the U.K. So the main purpose of that was to go back into profitability and strengthen our position in terms of profitability in the U.K. That the purpose of it.

Okay and who would you sold that to? Cees 't Hart: We sold it to Tuna [ph].

Okay, thank you. Cees 't Hart: Sorry, it was the DHL. Sorry.

Okay, so is that trade team? Cees 't Hart: Yeah

All right, okay, thank you.

Thank you. Our next question comes from the line of Tristan van Strien from Deutsche Bank. Please go ahead. Your line is up open.

Good morning, gentlemen. Three questions if I may. Just a first one on Western Europe use of volumes that you've lost in Poland, U.K. and Finland, do you expect to get those back next year and if you do, why would they not be margin dilutive, I mean we why would Tesco give you a better deal next year basically and such? The second question is just a bit of clarity on your Russia stock built, so if I catch it correct, your service is 3% increase in stock for the company. If I do my calculations basically that means all your growth in Russia emitting growth is come from the PET 1.5 liter and above, is that correct or another way of saying it if excluding the 1.5 liters and up what would your growth have been in Russia basically? And then the third one just a follow-up on Habeco, besides the first right of refusal, do you also have a lost right of refusal or one should go and to the auction process and things keep retching up basically it's an open auction? Thank you. Cees 't Hart: Okay, thank very much. Well, except maybe from Tesco who decided for us the other two contracts we decided on because of our lower margin. And, yes we had the name of the game is coming back there, but obviously not for the same kind of margin as we excited as normal. So we continuously talk with the three of them of course we run to improve our margin there, and otherwise frankly we're not in business with them just following our Golden Triangle. So doesn’t make sense to come back with the same kind of trade terms as we have in the past that’s the answer on the front. With regard yeah sorry…

No that’s fair. Go ahead. Cees 't Hart: Okay. Then with regard to Russia, as I said not 3% with three days stock, we feel it's 1% to 2% at Q3 growth, so that’s the impact of that. And with regard to Habeco?

Yeah with regard to a Habeco, we do have as we said continuously, we do have a first right of refusal. We cannot and will not comment more specifically on the ongoing negotiations, but we do have a first right of refusal.

Okay. So just to go back on the Russia, there is one so of that mid-teens growth in Russia only 1% to 2% are you saying is coming out of the large pack PET? Cees 't Hart: Yes with 16% of volume growth and 1% to 2% is part of the PET bottle. Yeah.

Okay, thank you. Cees 't Hart: I think we have time for a final question. Can we have the final question please?

Okay sure. So the final question comes from the line of Alicia Forry from Liberum. Please go ahead. Your line is now open.

Hi good morning. Just coming back to the low growth that we're seeing in Vietnam and Cambodia and just generally in some of your Asian markets outside of India, can you give us some sense of what your outlook is for that over the near term for gross in those markets, because volumes growing 4% ex-China and India up to 20%, it must be pretty weak for us I think there. And you've touched on some of the reasons for that, but if you could just give us a sense of what we might expect an underlying growth over the near term from those markets? I think that would be helpful. And then also can you comment on the outlook for further brewery closures in China over the near term? Cees 't Hart: Okay, thank you very much, Alicia. With regard to Asia, we are still positive about Asia. As you have seen in our results and we continuously comment on that China might be in the pressure with regard to volumes mainly due to the fact that we retrieved from Asian assets. But we see our value brands growing significantly which of course is good news for us in China. India is moving well. And to your point, Vietnam and Cambodia is a bit less stellar, but there, we must admit that we didn't have much new commercial activities of last couple of years, and we therefore launched under the guidance of the SAIL’22 the Tuborg brand and we have a lot of expectations from that. The penetration is really relatively high. We see the distribution developing very well. The repeat is good, so in that respect we expect from Vietnam and Cambodia more in the future. Heine the last…

In terms of the outlook for the further breweries closures in China, as we’ve said that we're not done with the program yet, we still have a few breweries we’re working on, but we're not going to be more specific. But we still have a few we’re working on. Cees 't Hart: So I think this is the end of the call. This was the final question for today. Thank you for listening in and thank you for your questions. We are looking forward to meeting some of you during the coming days and week. Have a nice day. Bye, bye.

Thank you. This now concludes our conference call. Thank you for attending. You may now disconnect your lines.