NETHERLANDS: Weather dampens Heineken Q1 despite profits lift
- Q1 like-for-like net profits up by 36.7% to EUR227m (US$295.2m)
- Net sales increase by 8.1% to EUR4.15bn
- Q1 operating profits “increased in the mid-teens”
- Group volumes down by 2.7% organically
Heineken released a first-quarter trading update today
Heineken's acquisition of Asia Pacific Breweries has helped ramp up Q1 profits and sales but volumes dropped due to poor weather and European austerity measures.
Net profits increased by 36.7% to EUR227m (US$295.2m) in the three months to the end of March, the Dutch brewer said in a trading update today (24 April). Net sales climbed by 8.1% to EUR4.15bn over the same period, while operating profits increased “in the mid-teens”, the company said.
Profits and sales were boosted by Heineken's ongoing SGD5.4bn (US$4.3bn) integration of APB, which posted low double-digit volume and revenue growth in Q1, the brewer said. However, on an organic basis, excluding the impact of the APB buy, net sales dropped by 2.7% and operating profits slipped by “mid-single digits”, Heineken said.
Group beer volumes were also down organically, by 2.7%, with Heineken blaming the quarter's one-day-shorter selling period compared to last year. The brewer said tough global economic conditions and “unfavourable weather” were also to blame for the “weaker than expected” quarter.
The biggest volumes drop was in Western Europe, down by 8.7% organically, as cold weather and government austerity measures squeezed demand. Group beer volumes in the UK, Italy, Netherlands and Spain all declined in the mid- to high-single digits, Heineken said. Brand Heineken volumes dropped a precipitous 13.6% organically in the region.
Looking ahead, Heineken said global markets will remain tough, with European cutbacks likely to affect the company throughout 2013. The brewer also said inflationary pressure in Nigeria will impact volumes in the country, leading to lower organic growth.
Heineken's share price was down by 5% in trading this morning.
Heineken also said that its integration of APB is progressing well and remains expected to complete in June.
To read the company's official statement, click here.
Earlier this week, analysts at UBS released their latest 'Beeronomics' research note, looking at the global beer landscape. Here, courtesy of UBS, is a breakdown of the top 25 beer markets around the ...
Two entities expressed "serious interest" in buying collapsed wholesaler Waverley TBS after it called in administrators last year, it has emerged. ...
- What's so special about Islay anyway? - Comment
- Six key trends for alcoholic drinks in 2016
- What do Bourbon and craft beer have in common?
- Ten things to know about spirits in the US
- Aus wine industry pays price for past failures
- Alcohol industry warning over Kroger plan
- SABMiller hits back in UK corporation tax row
- Diageo's Orphan Barrel The Gifted Horse - NPD
- Suntory bids for Lucozade, Ribena Nigerian network
- American rye whiskey sales leap 600% in five years
- What Next for Beer and Brewers Following the MegaBrew Deal?
- Global travel retail insights - market forecasts, product innovation and consumer trends
- Global Beer Trends 2015 : Global Beer Trends and Long-term Forecasts
- Global Whiskey Market 2016-2020
- Global sparkling wine insights - market forecasts, product innovation and consumer trends research