Emerging markets drive Heineken’s growth in third quarter results

HOLLAND – Leading Dutch brewing giant Heineken has reported a 2.5% growth in beer volume in the latest quarter, with growth in emerging markets offsetting lower volume in Europe.

According to the update, the Asia Pacific, Americas and Africa, Middle East & Eastern Europe were important drivers to the growth of the company’s volume, with Brazil, South Africa, Russia and Mexico contributing significantly.

The company reported a 20% growth in net profit for the nine months to €1,486 million from €1,239 million in 2016, which is significant since the 2016 result included an asset impairment of €233 million in the Democratic Republic of Congo (DRC).

“Performance in the third quarter was solid, with an acceleration of organic volume growth in Asia Pacific and Africa, Middle East & Eastern Europe.

Growth in Asia Pacific continued to be driven by Vietnam and Cambodia whilst in Africa, Middle East & Eastern Europe, the main contributors were Russia, Ethiopia and South Africa.

In the Americas, Mexico continued to deliver, and weaker volumes in the US were offset by growth coming from Brazil.

Europe had to face tough comparatives, partly due to less favourable weather in some key markets.

Total consolidated volume grew 8.8% to 10.2 million hectoliters in the Africa, Middle East & Eastern European region, second only to the Asia Pacific region where growth was recorded at 12.2% to 6.8 million hectoliters” said the brewer in a statement.

In Africa, volume declined in Nigeria mid single digit due to difficult trading conditions and consumers continuing to trade down.

Volume growth was up double digit in both South Africa and Ethiopia while the company’s new operation in Ivory Coast delivered ahead of expectations.

In the Asia Pacific, organic consolidated beer volume was up 12.2%, driven by Vietnam, China and Cambodia.

“In Vietnam, volumes grew double digit driven by Tiger. In Cambodia, volume was up double digit, continuing to benefit from the additional capacity added last year. Malaysia also delivered strong double digit volume growth,” the brewer said.

In Europe, organic consolidated beer volume declined by 2.8%, with France and the Netherlands, negatively impacted by a cool summer, with volumes declining on mid single digit. Volumes in the UK were down double digit.

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