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Heineken Delivers Strong Top-line Growth in 2019

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Heineken Delivers Strong Top-line Growth in 2019

Heineken Delivers Strong Top-line Growth in 2019
February 14
09:48 2020
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Global brewer Heineken achieved 5.6% organic growth in net revenue (beia) to €23.894 billion for 2019 and operating profit grew 3.9% organically to €4.020 billion. However, the operating profit margin fell by 12bps to 16.8%. Net profit (beia) for 2019 was €2.517 billion – up 4.3% organically.

Jean-François van Boxmeer, chairman and chief executive of Heineken who is due to step down on 1 June 2020, comments: “In 2019, we delivered another year of superior top-line growth, with continued strong performance in the second half. Growth was well balanced with beer volume up 3.1% and revenue per hectolitre up 3.3%, driven by robust pricing and focus on premiumisation. The Heineken brand growth accelerated to 8.3%, with more than 40 countries delivering double digit growth. The successful roll-out of Heineken 0.0 continued and it is now available in 57 markets.”

He elaborates: “Our strategy continues to be growth oriented with an ever-increasing emphasis on the sustainability of this growth, both socially and environmentally. Over the past decade, we have lowered our water usage by almost a third to 3.4 hectolitres of water per hectolitre produced, ahead of our 2020 target. We increased the proportion of renewable energy in production to 19%. In more than 60 markets, we spent over 10% of Heineken® media budgets on responsible consumption awareness campaigns.”

“We closed the year with an operating profit (beia) organic growth of 3.9%. In a context of increased input costs, we have continued to work on the efficiency of our operations whilst steadily investing behind our brands, our sustainability agenda and our digital transformation. Looking ahead to 2020, we expect our operating profit (beia) to grow by mid-single digit on an organic basis, barring major negative macro economic and political developments.”

In Europe, consolidated beer volume was marginally lower on an organic basis, with the region returning to growth in the second half. The premium and the low or no alcohol portfolios grew mid-single digit, with Heineken 0.0 growing mid-double digit. Total consolidated volume declined 0.4% organically.

Net revenue (beia) in Europe increased by 2.0% organically to €10.629 billion  with net revenue (beia) per hectolitre up 2.3%. Price mix was up 1.8% on a constant geographic basis driven by the growth of the Heineken brand, Desperados, Birra Moretti, local premium propositions and craft. European operating profit (beia) decreased by 0.8% organically to €1.436 billion impacted by a significant step up in investment to upgrade the group’s technology and digital platforms. Operating profit (beia) margin declined by 51 bps to 13.5%.

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