Heineken warns over volatility in emerging markets despite profit boost
Dutch brewer Heineken has predicted a rough ride ahead in emerging markets despite bolstering profits by a quarter.
The brewer toasted a 25% rise in net profits to €1.89bn for the full year, helped by a “positive” UK performance with the launch of Strongbow Cloudy Apple cider.
Its boost to profits was cheered on by “double digit growth” of its tequila-flavoured beer brand Desperados, which matched performances by sister brands Affligem and Sol Premium.
But while chairman and chief executive Jean-Francois van Boxmeer said he was confident of delivering “top and bottom line growth in 2016”, he warned against deflationary pressures and increased volatility across emerging markets.
Revenues also grew organically by 3.5% to €20.5bn for the full year, just short of analyst expectations.
The company – which also owns cider brand Bulmers and Foster’s- said it had managed to offset weaker consolidated beer volumes in Africa, the Middle East and eastern Europe with a 2.3% rise across America, Asia Pacific and Europe.
The beer volumes were handed a fillip from fizzing performance across the Americas, which drove home 7.2% organic growth in the fourth quarter and a 5.1% rise for the full year.
Mr van Boxmeer said top and bottom line growth for 2015 was driven by cost efficiencies and increased investment in its brands, as it expanded its reach across Africa, the Caribbean, Asia, eastern Europe and South Africa.
The brewery industry began a major overhaul last year when Anheuser-Busch InBev mounted a takeover of rival SABMiller for $104bn.
Beer brands including Peroni, Grolsch and London’s Meantime brewery are being eyed for sale as AB InBev looks to gain regulatory clearance for the takeover.
It has been reported that Japanese beer giant Asahi Group may look to buy Italian-brewed Peroni and Dutch-brewed Grolsch.
Heineken employs 81,000 across the globe, with UK breweries and cider plants in Herefordshire, Edinburgh, North Yorkshire, Manchester and London.
