Heineken saw sales slow in Q3

Heineken saw sales slow in Q3

Earlier today, Heineken reported a 1.7% decrease in Q3 sales. Here, just-drinks takes a closer look at the group's performance by region in the three months to the end of September:

  • Africa Middle East – sales up by 4.1% organically, volumes increase by 8.1%

The region's volume performance was driven by Ethiopia, Burundi, Algeria, Cameroon and Tunisia. The addition in Ethiopia of a new brewery, which started production in July, helped Heineken in the market, while volumes also increased in Rwanda, Egypt and the Democratic Republic of Congo. Nigeria was hit by “a prolonged wet season”, however, resulting in lower consumer spending and flat volumes in the quarter. South Africa's volumes also slipped slightly.

A negative country and product mix led to a 4% drop in revenue-per-hectolitre in the region.

  • Americas – sales were up by 4.1% organically, volumes up 2.9%

Mexico performed well, thanks to marketing activations in the country in the quarter, which drove sales of Tecate Light and Dos Equis, the company said. Volumes in Brazil fell due to lower consumer spend after the FIFA World Cup in the country, which ended on 13 July. The country's economic environment was described as “softening”, although brand Heineken posted double-digit growth, the brewer noted. Sales to retailers in the US were positive thanks to the “continued solid growth” of Heineken's Mexican portfolio and a market out-performance by brand Heineken.

Revenue-per-litre in the region rose by 1.2% in the quarter, due to “continued effective revenue management”.

  • Asia Pacific – sales jumped by 11.9% organically, volumes climbed 9.6%

Strong performances were flagged in India, Vietnam, China, Indonesia, New Zealand, Cambodia and the export markets of Taiwan and South Korea. Vietnam's volumes benefitted from “improved consumer sentiment”. The Tiger brand did particularly well in Vietnam and Malaysia.

Revenue-per-hectolitre rose by 2.3% in the region.

  • Central & Eastern Europe – sales slid by 6.4% organically, volumes fell 7%

Russia, Poland and Romania offered challenges in the quarter, as did poor weather in the region. Ongoing legislative effects hit Heineken in Russia, resulting in a low single-digit drop in volumes. The brewer's “premium brand portfolio” delivered “solid growth”, however. Pricing pressure for competitors squeezed the company in Poland, while bad weather led to falling volumes in Austria. Serbia, Germany and Greece reported rising volumes in Q3.

Revenue-per-hectolitre was flat, inching up 0.6%.

  • Western Europe – 2.4% drop in organic sales, volumes decreased 3.8%

With a tough comparative from a year earlier, “exceptionally high” rainfall levels across the region did not help matters for Heineken in Q3. The UK, France and Italy all posted mid single-digit volume decreases, although Spain grew volumes in the low single-digits. The country benefitted from “improved trends” in both the on- and off-premise in the period.

Revenue-per-hectolitre across the region inched up by 1.4%.