THE NETHERLANDS: Heineken beats rivals with solid H1 growth
The world's number four brewer Heineken has posted a strong growth in earnings and turnover for the first half and has reported that it expects to continue the good progress for the full year, as it outperforms its European rivals.
Net turnover of the Heineken Group increased in the first half of 2002 by €509m (11%) to €4,958m. Of this growth, the first time consolidation of new acquisitions, notably Bravo Holding in Russia, BrauHolding International in Germany and a number of European beverage wholesalers, accounted for 5% and organic growth (reflecting improvements in the sales mix, higher selling prices and volume growth) added 6%.
Group volume was 12% higher in the first six months of 2002 compared with the corresponding period in 2001, rising to 41.5m hectolitres. However, organic volume growth amounted to only 2% and newly consolidated companies added 10% to the sales volume. Substantial volume growth was recorded in Poland, the US, Slovakia, Vietnam and Africa.
But, beer consumption was adversely affected by wet weather in the spring, especially in Western Europe. Market share increased in Poland and remained stable or decreased slightly in other European countries.
Operating profit for the first half of 2002 was up 13%, from €513m to €581m, representing 11.7% of net turnover compared with 11.5% in 2001. Organic growth in net turnover accounted for most of this increase.
The company said profits from ordinary operations, its main performance yardstick, grew 11% in the first half to €330m from €298m last year.
In a statement the company said: "Growth in operating profit in the second half-year will be stronger than in the first six months of 2002. Improvements in sales mix and selling prices will continue in the second half of the year. However, growth in sales volume will be curtailed by the bad weather in large parts of Europe in the summer of 2002. Moreover, the tax burden and the minority interests in the net profit will be higher than in last year. The recent movements in the value of the dollar will have little effect on profit. On this basis, the company expects an increase in net profit on ordinary activities for 2002 as a whole to be in line with the percentage growth in the first half of 2002."
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