GLOBAL: Flat Q3 sales, but Heineken still ups forecast
Heineken has raised its full-year profits target following what it calls "the positive development" of its third quarter.
The Netherlands-based brewer said today (28 October) in a trading update that organic earnings before interest in the three months to the end of September delivered a mid-teens increase, driven by "strong pricing, improved sales mix and aggressive cost cutting", Heineken said.
Sales in the third quarter totalled EUR4.07bn (US$6.02bn), flat versus the three-month period a year earlier.
The profits rise came despite a 4.7% slide in volumes for the period, with Central and Eastern Europe and the Americas both seeing volumes fall by approaching 10% each. The volume fall in the quarter represented an improvement versus the trend in the first half - group volumes for the year so far are down by 5.1% year-on-year at 121.3m hectolitres.
"In Europe, Asia and the Americas," the brewer said, "volume continues to be under pressure as a result of the global economic conditions, which also result in consumers trading down to low-margin private label beers, a segment in which Heineken does not seek to compete."
Looking forward, Heineken said that it has raised its full-year profits forecast to low double digit compared to an earlier estimate of at least high single digit.
"Following the positive development of Heineken's financial performance in the third quarter and given the current trading, Heineken increases its forecast for organic net profit (beia)," Heineken said.
"Net profit (beia) in 2009 may still be slightly lower than in 2008, due to weaker currencies in the second half of the year and the negative contribution of first time consolidation in the first half."
For the full statement, click here.
The wave of major consolidation activity in the beer market over 2008 was followed by weakening volume growth in 2009 as the economic downturn put a dampener on bullish tactics. With the global beer l...
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