NETHERLANDS: Cost cutting lifts Heineken H1 profits
Cost savings have helped Heineken to a 20% rise in net profits for the first half of 2009, despite a dip in like-for-like beer sales for the period.
Net profits for the six months to the end of June rose by a fifth to EUR489m (US$700m), compared to EUR407m in the same period of 2008, Heineken said today (26 August).
Cost controls across the business, as promised by the brewer at the start of the year, boosted profits.
"Our rigorous Total Cost Management programme is delivering early results, with annualised savings of EUR120m achieved," said group CEO Jean-François van Boxmeer. "We see substantial opportunity to drive down our cost base in the second half of the year and beyond," he added.
Price rises and the contribution of Scottish & Newcastle saw Heineken's net sales rise by 11% to EUR7bn for the half-year, although fell by 0.4% on an organic basis with the contribution of Scottish & Newcastle stripped out.
Beer sales by volume fell 5.6% on an organic basis, due to difficult beer markets, particularly the UK.
"The economic and trading conditions remain difficult, and there will be continued pressure on volumes in the second half of 2009," said Van Boxmeer.
"However, our focus on brand building, prioritised investment and rigorous cost reduction will continue to deliver value in the second half of the year," he said, adding that the group expects organic net profit growth in high single digits for 2009.
For the full announcement, click here.
For Heineken's Q1 results, click here.
An update, following the brewer's results webcast, appears here.
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