(MENAFN – GlobeNewsWire – Nasdaq)
Amsterdam, 1 August 2022 – Heineken N. V. (EURONEXT: HEIA; OTCQX: HEINY) announces:
Dolf van den Brink, Chief Executive Officer and Chairman of the Board of Directors, said:
“We are encouraged by the effects of the first part of the year. We have benefited from the recovery in Asia-Pacific and catering in Europe with the return of customers to bars, with demand for resistance so far despite increasing inflationary pressures. “on the client’s disposable income.
Our business performed well in the first part of 2022. We outperformed the industry in more than a portion of our markets and the back of the Heineken® logo showed strong momentum, driven by increased support for the logo. pressures on our charge base. As a result, the source of operating profit is now particularly higher than that of 2019.
We continue to face dubious customers for consumers and businesses. Staying vigilant, we are fully committed to driving our EverGreen transformation for sustained, long-term price creation. In terms of customers, we reiterate our targets for 2022. By 2023, we are moving from an operating margin target to biological expansion in the operating revenue stream (beia). Our medium-term aspiration remains to generate an impressive and balanced expansion with operating leverage over time.
1 Consolidated figures are used in this report, unless otherwise indicated; see the glossary for an explanation of non-GAAP measures and other terms used in this report. 2 Organic expansion is shown, unless diluted EPS (beia), which is an overall expansion. 3 Includes acquisitions and excludes disposals over a 12-month period. proforma base.
HIGHER REVENUE GROWTH
Our ambition is to deliver incredible expansion with the right balance between volume and value-driven earnings expansion, positioning us as one of the fastest growing global beverage companies. our leading premium brands, presenting winning customer offerings in fast-growing segments and often shaping our geographic footprint and portfolio.
Revenue for the first part of 2022 was €16. 401 billion (2021: €11. 97 billion). Net sales (beia) increased by 24. 3% organically, thanks to a 7. 7% increase in total consolidated volume and a 15. 6% increase in net sales (beia) in line with hectolitre. The combined underlying price on a constant geographical basis increased by up to 15. 3%, driven through tariffs in all markets, covering entry fee inflation on a euro-for-euro basis, a positive channel combination and primalisation. Compared to 2019, overall consolidated volume grew organically by 0. 8% and net sales (beia) increased by 14. 4%, excluding consolidation changes, thanks to the recovery of post-COVID volumes, the expansion of our premium brands and the effect on inflation-driven charges.
Beer volume increased biologically by 7. 6% compared to last year and exceeded 2019 by 4. 2% on a biological basis. Faster growth in the current quarter, with beer volume up 9. 7%, driven by strong expansion in the Americas, continued recovery in Asia Pacific and catering in Europe, and modest expansion in Africa, the Middle East and Eastern Europe (AMEE) region. We have gained or maintained a market share in more than a portion of our markets.
Driving large-scale premiumization, led through Heineken ®
Premium beer volume increased by 10. 2%, driving almost a portion of the growth of our organic beer volume, led by Heineken®.
Heineken ® continued its strong functionality and increased volumes to 14. 6% in the current quarter to close the first component with an increase of 13. 8%, up 32. 9% from 2019. The logo recorded double-digit expansion in more than 50 markets, adding Brazil and China, Vietnam, South Africa, the Netherlands, Spain, Italy, Laos and the United Arab Emirates. Heineken ® Silver, which is now offered in 22 markets, has nearly doubled its volume, driven by strong expansion in Vietnam and China and its deployment in Europe and Asia. As part of the next step in its global launch, we brought Heineken® Silver to Mexico this month.
According to the Kantar BrandZ 2022 global survey, Heineken ® has experienced the fastest expansion in terms of “brand value” among major alcoholic beverage brands, thanks to its strong momentum of expansion, inventions and creativity. The latter was also identified this year at Cannes Lions, the prestigious Festival of Creativity, as the ultimate award-winning alcohol brand. The brand’s most recent campaign, “The Closer,” aims to spark a verbal exchange about the imbalance between work and personal life, with a smile. Heineken ® supports inclusion in the bar and on the football pitch and is a proud sponsor of the UEFA Women’s Euro.
Amstel’s volume increased in the 1920s, bringing a taste of Amsterdam to the world. More than 20 markets experienced double-digit expansion, with strong effects in Brazil, South Africa, Spain, the United Kingdom, the Netherlands, Mexico, Argentina, India and China. Amstel Ultra continued its expansion in the Americas to be successful in 12 markets. Birra Moretti continued to distribute the true taste of Italy throughout Europe and increased in volume in the mid-1920s. All European markets contributed to the expansion with strong momentum in the UK, Ireland, the Netherlands, Romania and Switzerland. Sol increased its volume through low-singles singles, driven by strong expansion in Brazil, Chile and South Africa, partially offset by declines in Mexico and Europe. In this Year of the Tiger, we are unleashing the expansion of our logo in Vietnam and beyond. Logo volume grew in the mid-teens, fueled by the current quarter’s recovery in Vietnam, Cambodia, and Malaysia, continued strong functionality in Nigeria, and the launch in Brazil last year. Tiger Crystal is now traded in 19 markets. Edelweiss grew in volume in the 1960s, bringing a taste of the Alps to Asia, breaking into 7 markets and announcing a local production center in Vietnam. Lagunitas volume grew in low single digits, as double-digit expansion in Europe was partially offset by a decline in the United States. Lagunitas’ non-alcoholic diversity extensions, IPNA and Hoppy Refresher, continued their momentum and gained volume among teens.
Pioneering choice in low and non-alcoholic alcohol (LONO)
Our LONO portfolio delivered low-digit volume expansion, with double-digit expansion in more than 20 markets, adding Brazil, Mexico, Spain, Germany, Panama and Ethiopia, offset by declines in Poland, Russia and Egypt.
The non-alcoholic beer and cider portfolio recorded high-digit volume expansion, led by Heineken ® 0. 0. Despite the disruption of sales in Russia, Heineken ® 0. 0 rose at teen lows, with strong functionality in Brazil and Spain.
We are expanding our industry-leading LONO portfolio to meet consumers’ desires for adult soft drinks with low or no alcohol content and wonderful taste.
Intentionally expanding beyond beer
We see many opportunities to expand our product portfolio beyond beer to better meet the desires of more consumers. Overall, our portfolio of flavored alcoholic beverages (FABs), adding strong ciders and soft drinks, increased its volume through a figure exceeding 6. 4 million hectoliters and is ahead of 2019 in the weak years.
Desperados continued its momentum, specifically in its main European markets and more than doubled its volume in Nigeria. For consumers looking for a trendy beer with a similar degree of alcohol, we introduced the sparkling sparkling water Desperados con tequila in the Netherlands in May.
Cider expanded again in the UK and Ireland and recorded double-digit expansion in South Africa, Vietnam, Spain and Portugal. For consumers who need a more balanced lifestyle, it introduced Strongbow Ultra Dark Fruit in the UK, a low-calorie cider that doesn’t compromise on good taste.
We inform ourselves of our reports in the markets and continue to introduce new proposals. We depend more and more on our most powerful brands for these proposals, together with new brands such as Pure Piraña. For example, we introduced Dos Equis Classic Lime Margarita and Disorderly Tea Casa in the United States.
Build a virtual address so that the customer has compatibility for the future
Our ambition is to be the connected brewer, so we have intensified our investments as a component of our virtual transformation to build a future-proof HEINEKEN, in particular by strengthening our virtual consumer adventure:
Strengthen and optimize our footprint
We are constantly looking at how we can expand our portfolio and geographic presence and embellish our long-term sustained expansion advantage.
In late 2021, HEINEKEN announced its proposed transaction with Distell Group Holdings Limited (“Distell”) and Namibia Breweries Limited (“NBL”). We are in the process of obtaining regulatory approvals to complete the transaction and look forward to closing it. at the time part of 2022.
On March 28, HEINEKEN announced its resolution to leave Russia. We are making smart progress to ensure an orderly move of our business to a new owner in full compliance with local and foreign legislation and hope to succeed in an agreement in the moment. part of this year. For more important points on the monetary implications of this resolution, see page 12.
FINANCING GROWTH
Given the existing inflationary environment, we are taking vital value and revenue source control measures to offset input inflation and other euro-for-euro charges. In addition, we structurally care for our charge base and build a charge-conscious culture. to mitigate load pressures, invest in our growth, and direct our business to provide operating leverage over time.
We continue to make significant progress in our productivity programme, with a gross structural savings target of €2 billion through 2023, compared to our 2019 load base. We have collected more than 9000 concepts through our systematic procedure, some that go beyond 2023. We are working to integrate this procedure so that concepts can learn, percentage and reapply throughout the organization. Some of these concepts require significant updating and are grouped into transformation programs. By the end of 2022, we expect to have captured €1. 7 billion of those savings, aimed at meeting our target.
Progress in achieving those savings has helped us drive investments as part of our expansion agenda, virtual transformation and sustainability initiatives. In addition, we are canceling significant fee mitigation measures taken to partially offset the monetary impact of lockdowns and other operating restrictions. during the pandemic. Last year, the overall charge mitigation measures represented a relief in spending (beia) of around €500 million for the full year compared to 2019. For example, marketing and sales expenses (beia) in the first component of the year increased organically through 264 million euros or 28. 5%, bringing the absolute point closer to the points prior to the pandemic.
Operating source of cash in building up to 2,070 million euros. The operating source of cash in (beia) increased organically by 24. 6%, driven by the recovery of volumes, value and cash control measures and the pursuit of strong gross savings through our productivity program, which more than offset significant inflationary pressures, the cancellation of our charge mitigation measures and an accumulation in investment. In total, the operating source of cash in (beia) was 21. 6% higher than in 2019, consolidation effects. The operating profit margin (beia) decreased to 16. 0%, 35 basic problems in the first part of 2021, due to consolidation changes; The operating profit margin would have remained stable.
Net revenue source of more than €1,265 million. The net revenue source (beia) increased 40. 2% organically, driven by the expansion of the source of operating income, the decrease in net monetary and interest expenses and the normalization of the effective tax rate.
WE RAISE THE LIMIT OF SUSTAINABILITY AND RESPONSIBILITY
We are making steady progress in opposition to our Brew a Better World strategy, focusing on 3 areas: raising the bar for climate action, accelerating our social sustainability agenda, and boosting our brands to promote alcohol consumption.
Environment: Towards impact 0
Throughout our adventure to become a net 0 across our price chain through 2040, roadmaps have been developed with our largest operating companies, accounting for 75% of our total emissions. In South Africa, we present the largest solar power plant in the African brewing industry, cutting carbon from the brewery has an effect of up to 30%.
In terms of healthy watersheds, two new wastewater treatment plants were installed in our breweries in Serbia and Haiti. Meoqui in Mexico is our brewery of maximum water efficiency, using less than 2 liters of water per liter of beer.
Social: the path to an inclusive, just and equitable world
Currently, 26% of our senior managers are women and we aim to increase this percentage to at least 30% by 2025 and 40% by 2030 on the road to gender balance.
The Heineken® logo has revealed a new direction for its sponsorship in football, making its entire football crusade, men’s and women’s matches, the fight against gender biases that affect both players and sports enthusiasts.
Responsible: path to moderate and non-harmful use
Heineken® 0. 0 is presented in draft in many pubs across the country in the UK. Thanks to a partnership with ITV, it is now one of the uk’s two largest soap opera series helping to normalise non-alcoholic beer consumption.
We have also presented a new episode of our campaign “When you drive, never drink”, addressing the factor of overconfidence in alcohol consumption, with F1 drivers Daniel Ricciardo and Sergio Pérez.
Governance
We have aligned our Long Term Incentive Policy (LTI) with our sustainability ambitions by adding 3 Brew signs to Better World representing 25% of the overall LTI: carbon relief in production, international water power and percentage of at the senior management level.
Our multi-year EverGreen strategy aims to generate amazing and balanced expansion for the creation of long-term sustainable prices. We are encouraged by the speed and progress made on our key strategic programs, and the strong recovery of our business after COVID.
At the same time, we continue to see a challenging global environment and a dubious economic outlook. While customer demand as a total was resilient in the early part of the year, there is a growing threat that the growing pressure on customers’ buying force will intensify. consumption.
We expect significant inflationary pressures on our charge base and continued investments in our business to continue and have an impact in the current part of 2022 and through 2023. The recent slowdown in some commodities is offset by unprecedented levels of value and the threat of herbal fuel. availability, the maximum of which are affecting Europe, our largest region. Our price and profit control measures have compensated well for those inflationary pressures so far in absolute terms, and we remain committed to continuing to do so. In addition, our productivity program continues at a stable pace, raising the overall contribution of gross savings to €1700 million through the end of 2022 compared to the 2019 load base. This will continue to offset loading pressures and increase investments in logo support, our virtual transformation and sustainability initiatives.
For 2022, we remain our outlook unchanged and expect a solid to modest sequential improvement in operating profit margin (beia) compared to last year. We are converting our previous guidance for 2023. We will move from an operating margin target to a biological expansion in the source of operating income (beia), in the mid to high range, any unforeseen macroeconomic and political developments. In the medium term, we reconfirm our aspiration to achieve an impressive and balanced expansion with long-term operating leverage.
Based on the effect to date, and applying the spot exchange rates of 28 July 2022 to the monetary effects of 2021 as a reference for the remainder of the year, the calculated positive conversion effect would be approximately €1. 5 billion net. sales (beia), €210 million from consolidated operating income source (beia) and €140 million from net revenue source (beia).
HEINEKEN dividends are paid in the form of an interim dividend and dividend balance. The interim dividend is set at 40% of last year’s total dividend. As a result, an interim dividend of €0. 50 consistent with the consistent percentage (2021: €0. 28) will be paid on August 11, 2022. The corresponding percentages are quoted ex dividend on August 3, 2022.
HEINEKEN will hold a convention call for analysts and investors related to its 2022 mid-year effects today at 14:00 CET/13:00 GMT. The call will be streamed live through the company’s website: Array. An audio playback service will also be carried out after the convening of the convention at the internet address above. Analysts and investors can log in at the following phone numbers:
UK (local): 020 3936 2999
Netherlands (local): 085 888 7233
United States: 1,646,664,1960
All places: 44,203,936,2999
Participation password for all countries: 810785
Editorial data: HEINEKEN is the world’s leading foreign brewer. It is a leader in the development and distribution of high-end non-alcoholic beer and cider logos. Led through the Heineken® logo, the Group has a portfolio of more than three hundred foreign, regional, local and specialty beers and ciders. With more than 85,000 HEINEKEN employees, we harness the joy of true solidarity to motivate a bigger world. Our dream is to shape the long term of beer and beyond to conquer the hearts of consumers. We are committed to innovation, long-term logo investment, disciplined sales execution and specific charge management. Thanks to “Brew a Better World”, sustainability is incorporated into the company. HEINEKEN has a well-balanced geographic presence with leadership positions in and emerging markets. We operate breweries, malt houses, cider houses and other production facilities in more than 70 countries. The most recent data can be found on our company’s online page and is attached to us on LinkedIn, Twitter and Instagram.
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Disclaimer: This press release contains forward-looking statements regarding the monetary condition and effects of HEINEKEN’s operations. These forward-looking statements are subject to threats and uncertainties that may cause actual effects to differ slightly from those expressed in the forward-looking statements. Many of those threats and uncertainties relate to items that are beyond HEINEKEN’s ability to control or should be estimated, such as long-term market position and economic conditions, developments in the COVID-19 pandemic and movements similar government agencies, habit of other market position participants, adjustments in customer preferences, ability to effectively integrate acquired businesses and realize expected synergies, raw curtain costs, fluctuations in interest rates and exchange rates, tax rate adjustments, legislative adjustments, pension cost adjustments, moves by government regulators and weather conditions. These and other threat points are detailed in HEINEKEN’s public annual reports. You are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date of this press release. HEINEKEN assumes no legal responsibility to update any forward-looking statements contained in this press release. The market position percentage estimates contained in this press release are based on external sources, such as specialized research institutes, in combination with control estimates.
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