Heineken’s EverGreen strategy gathers momentum as 9-month profit rise to US$3.56B

NETHERLANDS – Heineken, the world’s second-largest beer manufacturing company, has reported a €3.08 billion (US$3.56 billion) net profit for the first 9-months of 2021, a significant jump from €396 million that was reported during the same period last year. 

The rise significant jump in profits has been partly attributed to the Evergreen strategy that the company adopted in February this year to respond to current times while staying true to company values and heritage. 

Although 9 months’ revenues were impressive, the company’s Q3 revenues were not as stellar. Beer volume sales declined 5.1% on a like-for-like basis after its Asia Pacific region was significantly impacted by the pandemic in the quarter. 

However, Heineken’s volume increased by 8.0% in the quarter and by 15.1% for the first nine months of the 2021 fiscal year. 

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Beer volumes were up in Q3 for the company’s Africa, Middle East & Eastern Europe business – which recorded organic growth of 5.5%. 

However, beer volumes were down across the Americas, the Asia Pacific, and Europe regions – which recorded declines of 3.4%, 37.4%, and 2.3% on an organic basis. 

Vietnam, one of Heineken’s top three markets in AsiaPacific –contributing more than half of the company’s sales in the region, suffered a record contraction in the third quarter as an outbreak of the Delta variant of the coronavirus led to a strict lockdown in the commercial hub of Ho Chi Minh City. 

The city’s lockdown started to ease this month, and though bars remain closed, Heineken Chief Executive Dolf van den Brink said there are signs of recovery in the Asia-Pacific region 

“As anticipated, our Asia Pacific region was deeply impacted by the pandemic in the third quarter. We see first signs of recovery and I admire the resilience and solidarity of our people as we navigate these challenges,” said Dolf van den Brink, Heineken chairman and CEO. 

European sales also disappointed, failing to deliver an expected uplift. Heineken said the weakness partly reflected poor summer weather in northern Europe, though it also faced logistics disruptions in Britain. 

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Heineken has begun integrating United Breweries in India and which it took control of in July, pushing its holding to 61.5 percent from 46.5 percent before. 

“We began the integration of United Breweries in India and continue to be enthusiastic about the long-term opportunities ahead,” Van den Brink said. 

The Heineken CEO further noted that markets remained “volatile and we are responding accordingly,” by taking an assertive approach to pricing and cost across all of our markets to meet this challenge. 

Given the tough environment that Heineken anticipates in the foreseeable future, the company has revealed that its expectations stay unchanged, with full-year results remaining below 2019. 

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