Heineken tempers 2013 growth outlook as Europe slows down

City A.M. Reporter
HEINEKEN, the world’s third largest brewer, said yesterday that austerity-hit Europe and inflation in Nigeria had lowered its expectations for growth this year, after its beer sales fell in every region except Asia in the first three months.

The Dutch brewer, which along with rivals is looking increasingly to Asia for growth, said sales volumes and revenues would grow this year, but probably at rates lower than in 2012.

Previously Heineken, which also brews Sol, Tiger and Strongbow cider, had forecast growth in 2013 would be at least as high as last year.

“What we lost in the first quarter is done. We don’t get that back. Secondly, the rebound in Nigeria is later than expected,” finance chief Rene Hooft Graafland said. “Third, western Europe stays a difficult market.”

About 60 per cent of operating profit now comes from emerging markets, on a par with rival Anheuser-Busch InBev, from 40 per cent in 2007.

Heineken said its revenue in the first three months rose 8.1 per cent to €4.15bn (£3.5bn), below the average €4.29bn expected in a poll of seven banks and brokers.

Excluding the full takeover of APB at the end of last year and currency effects, revenue was down 2.7 per cent. The group said operating profit declined by a mid-single digit percentage on a like-for-like basis, due to lower revenue only partly offset by a cut in marketing expenses and the results of its cost-savings.