Heineken N.V. reports 2013 third quarter results
(Thomson Reuters ONE) -
Amsterdam, 23 October 2013 - Heineken N.V. today announced its trading update
for the third quarter of 2013.
HIGHLIGHTS
* Group revenue: +1% reported; +0.4% on an organic basis
* Group revenue per hectolitre +2.7%; sustaining investment in innovation and
marketing to support revenue development
* Group beer volume stable on a reported basis; organically 2% lower,
primarily driven by beer market weakness in Central & Eastern Europe
* Continued solid performance of acquired operations of Asia Pacific
Breweries[1]
* Heineken® volume in the premium segment returned to growth in the quarter
* Implementing restructuring and other cost efficiencies initiatives across
Europe under current TCM2 programme
* HEINEKEN now expects 2013 net profit (beia) to decline in the low single-
digits, on an organic basis (previously 'broadly in line with last year')
CEO STATEMENT
Jean-François van Boxmeer, Chairman of the Executive Board & CEO, commented:
"In the quarter, the recently acquired business of Asia Pacific Breweries again
achieved solid growth. We also witnessed an improved sequential volume trend in
Western Europe, resulting in a number of share gains across the region. However,
underlying trading conditions across Europe remain challenging, as evidenced by
a weak consumer environment in Central & Eastern Europe in the quarter. As a
consequence, we are accelerating efforts to drive improved efficiencies,
particularly in Europe, through restructuring and other cost related
initiatives. Looking forward, we remain confident that our broad geographic
spread and strong brand portfolio will continue to support long-term growth for
HEINEKEN."
OPERATIONAL OVERVIEW
+-----------------------+-----------------------+
Key figures[2] | Consolidated | Group |
+-----------------------+-----------------------+
(in mhl or ? million) 3Q13 Total Organic 3Q13 Total Organic
growth % growth % growth % growth %
--------------------------------------------------------------------------
Revenue
Heineken N.V.[3] 5,179 4 - 5,693 1 -
Africa Middle East 585 -9 -3 705 -11
Americas 1,160 -3 2 1,397 2
Asia Pacific 494 >100 - 540 66
Central & Eastern Europe 895 -9 -4 1,006 -8
Western Europe[4] 2,150 -1 1 2,150 -1
--------------------------------------------------------------------------
Beer volume
Heineken N.V. 48.3 5 -3 52.8 - -2
Africa Middle East 5.5 -2 -2 6.8 -1 -2
Americas 13.0 -4 -2 13.8 -4 -2
Asia Pacific 4.3 >100 - 5.5 45 2
Central & Eastern Europe 13.0 -8 -8 14.2 -8 -7
Western Europe 12.5 1 2 12.5 1 2
--------------------------------------------------------------------------
[1] Asia Pacific Breweries Ltd and Asia Pacific Investment Pte Ltd
[2] Refer to the Definitions section for an explanation of non-IFRS measures and
other terms used throughout this report
[3] Net of head office & eliminations
[4] Following the sale of Oy Hartwall Ab, volume and financials are
deconsolidated from 1 September 2013
Heineken® 3Q13 Organic YTD Organic
(in mhl) growth 2013 growth
% %
----------------------------------------------------------------------------
Heineken® in premium segment 7.6 1 20.9 -1
Africa Middle East 0.8 1 2.5 3
Americas 2.2 -1 6.3 -2
Asia Pacific 1.6 2 4.5 1
Central & Eastern Europe 0.7 -5 1.8 -1
Western Europe 2.3 4 5.8 -4
----------------------------------------------------------------------------
Group beer volume decreased by 2% organically (including the benefit of one
additional selling day in the quarter), primarily reflecting weakness in Central
& Eastern Europe beer markets. This was partly offset by an improved volume
performance in Western Europe. Heineken® volume in the international premium
segment grew by 1%. Key markets contributing to Heineken® brand growth in the
quarter were France, Brazil, Spain, Nigeria, China and South Korea.
Group revenue was slightly ahead of the prior year quarter (+0.4%), on an
organic basis. Group operating profit (beia), on an organic basis, was slightly
lower, reflecting a stable revenue performance and higher phasing of marketing
spend in the quarter.
Consolidated revenue increased 4% to ?5,179 million, including a positive net
consolidation impact of 7% (+?369 million) and an unfavourable foreign currency
effect of 3% (-?171million) following the depreciation of a number of key
currencies against the euro. Organically, consolidated revenue increased by
0.2%, with a total consolidated volume decline of 3.2% more than offset by a
3.4% increase in revenue per hectolitre (including a positive country mix impact
of 1%).
Reported net profit in the quarter was ?483 million compared with ?568 million
in the third quarter of 2012. This includes net exceptional items and
amortisation costs of ?70 million in the quarter (compared to ?38 million in the
prior year period).
OUTLOOK STATEMENT
(Based on consolidated reporting)
During the third quarter, weak beer market conditions in Central & Eastern
Europe and the delayed economic improvement in key developing markets, led to a
lower than expected volume performance. HEINEKEN will support operating profit
(beia) with a continued focus on cost efficiencies and revenue management
initiatives. Below operating profit, recent unfavourable currency movements
impacted on other net finance expenses in the third quarter. Consequently,
HEINEKEN now expects full year net profit (beia) to decrease in the low single-
digits, on an organic basis (previously 'broadly in line with last year'). The
recent strength of the euro against a number of key developing market
currencies, is now expected to result in a combined impact of foreign currency
translation movements and consolidation changes reducing full year 2013 net
profit (beia) by approximately ?40 million (based on current spot rates).
HEINEKEN reaffirms all other elements of its full year outlook for 2013 as
stated in its first half 2013 earnings release dated 21 August 2013.
TOTAL COST MANAGEMENT 2 (TCM2)
HEINEKEN continues to make strong progress under the current TCM2 programme. In
response to the ongoing challenging trading environment in Europe, HEINEKEN is
further intensifying efforts to optimise its cost structure in Europe, including
head office functions. In the second half of 2013, HEINEKEN will incur pre-tax
exceptional costs of approximately ?70 million related to rightsizing and other
restructuring activities across Europe. Of this amount, ?16 million is non-cash
related. These activities are expected to generate recurring annualised benefits
from 2014 onwards and form part of the additional ?100 million of cost savings
(previously announced in August 2013) under the current TCM2 programme ending
2014.
REGIONAL REVIEW
Africa Middle East
Consolidated revenue declined by 3% organically in the quarter, with solid
revenue per hectolitre growth of 4% offset by lower total volume. Total group
volume declined by 6% reflecting a 2% decrease in beer volume and double-digit
decline in non-beer volume. The decline in non-beer volume follows the planned
discontinuation of certain SKU's in the soft drink and water categories in Egypt
and Tunisia, respectively, to deliver value growth. A resurgence of social
unrest in Egypt and ongoing volatility in the Democratic Republic of Congo
particularly impacted beer volumes in the quarter. Volume in Nigeria was
slightly lower as inflationary pressures, tight credit conditions and high
unemployment continue to impact consumer spending. Despite challenging economic
conditions in South Africa, volume in the quarter grew in the low single-digits
led by a solid performance of the Amstel brand, in combination with a strong
Heineken® brand performance in the first nine months of the year.
Americas
Consolidated revenue grew 2% organically in the quarter, largely driven by
successful revenue growth initiatives across the region. Group beer volume
declined by 2%, mainly due to the subdued beer market in Brazil. Continued
economic uncertainty in Brazil contributed to soft consumer spending in the
country and a high single-digit volume decline, with lower sales of the
mainstream portfolio only partly offset by solid growth of the Heineken® brand.
In Mexico, volume declined slightly, reflecting the impact of hurricane weather
in September. In the US, sales to wholesalers and sales to retailers were both
broadly stable (adjusted for one additional selling day), contributing to
continued market share gains in the country. This follows strong double-digit
volume growth of Dos Equis, Tecate Light and Strongbow, partly offset by lower
volume of the Heineken® brand.
Asia Pacific
Group and consolidated volume and financials include the full consolidation of
APB, acquired on 15 November 2012. The organic growth calculation for
consolidated volume and financials only reflects performance in export markets.
Group beer volume grew organically by 2%, reflecting a solid volume performance
in the key markets of Vietnam, Indonesia, China and Papua New Guinea. This
performance was partly offset by lower volume in India following a prolonged
monsoon season and the continued adverse impact of earlier regulatory changes
introduced in the state of Tamil Nadu. Higher volume of the Heineken® brand was
supported by strong growth in China and South Korea. The Tiger brand grew by
20%, led by continued strong growth momentum in Vietnam and China.
Central & Eastern Europe
Consolidated revenue declined by 4% organically in the quarter, as weaker than
expected beer market conditions were only partly offset by solid revenue per
hectolitre growth of 3%. Group beer volume declined by 7% organically,
reflecting lower consumer spending in Russia, Romania and Greece and poor
weather across the region in September. Amidst challenging beer market
conditions, HEINEKEN maintained its overall market share in the region. The
Russian beer market was adversely impacted by earlier regulatory changes,
destocking from distributors and unfavourable weather, contributing to a double-
digit volume decline. Renewed political uncertainty and continued adverse
economic conditions in Greece led to a double-digit volume decline. The Romanian
beer market was affected by difficult economic conditions and poor weather,
leading to significantly lower volume. Volume in Poland grew in the low single-
digits, although revenue growth was held back by the continued impact of
negative channel mix. Volume in the quarter was also higher in Austria, Germany
and Serbia.
Western Europe
Consolidated revenue grew 1% organically in the quarter, representing a solid
recovery compared to the first half of 2013. Group beer volume grew by 2%,
organically, led by volume growth across the key markets of UK, Netherlands,
France and Spain. This was only partly offset by lower volumes in Italy, Belgium
and Switzerland. This improved volume performance reflects the benefit of
favourable weather early in the quarter and success of local and global brand
innovation, contributing to overall share gains across the region. In
particular, 'Radler' flavour brand extensions launched earlier this year in nine
markets in the region continued to gain consumer traction. However, despite a
better volume performance in the quarter, underlying trading conditions in the
region are expected to remain challenging, against a difficult economic backdrop
and the impact of austerity measures.
DEFINITIONS
Organic growth excludes the effect of foreign currency translational effects,
consolidation changes, accounting policy changes, exceptional items and
amortisation of acquisition-related intangibles. Beia refers to financials
before exceptional items and amortisation of acquisition-related intangibles.
Group figures include HEINEKEN's attributable share of joint ventures and
associates. Organic growth calculations assume HEINEKEN's joint venture share of
41.9% of APB and 50% of APIPL prior to consolidation is maintained through to
15 November 2013. Organic growth of consolidated volume, consolidated revenue
and consolidated operating profit (beia) excludes any impact from APB/APIPL.
Organic growth on group volume and group financials includes an impact from
APB/APIPL. Organic growth calculations are adjusted for the previous 3-month
delay reported by APB and APIPL, without a restatement to 2012. Comparative
2012 financials have been adjusted for the impact of revised IAS19. In 2013, the
first time impact of revised IAS19 on operating profit (beia), EBIT (beia), net
profit (beia) and EPS (beia) is treated as a non-organic item.
ENQUIRIES
Media Investors
John Clarke George Toulantas
Head of External Communication Director of Investor Relations
John-Paul Schuirink Aarti Narain
Financial Communications Manager Investor Relations Manager
E-mail: pressoffice(at)heineken.com E-mail: investors(at)heineken.com
Tel: +31-20-5239355 Tel: +31-20-5239590
Investor Calendar Heineken N.V.
Financial Markets Conference, Mexico 5-6 December 2013
Financial results for the full year 2013 12 February 2014
Trading update for Q1 2014 24 April 2014
Annual General Meeting of Shareholders (AGM) 24 April 2014
Conference call details
HEINEKEN will host an analyst and investor conference call in relation to this
trading update today at 10:00 CET/ 9:00 BST. The call will be audio cast live
via the Company's website: www.theheinekencompany.com/investors/webcasts. An
audio replay service will also be made available after the conference call at
the above web address. Analysts and investors can dial-in using the following
telephone numbers:
Netherlands United Kingdom
Local line: +31(0)20 716 8296 Local line: +44 (0)20 342 719 04
National free phone: 0800 020 2576 National free phone: 0800 279 4992
United States of America
Local line: +1 646 254 3388
National free phone: 1877 280 2342
Participation/ confirmation code for all countries: 1809737
Editorial information:
HEINEKEN is a proud, independent global brewer committed to surprise and excite
consumers with its brands and products everywhere. The brand that bears the
founder's family name - Heineken® - is available in almost every country on the
globe and is the world's most valuable international premium beer brand. The
Company's aim is to be a leading brewer in each of the markets in which it
operates and to have the world's most valuable brand portfolio. HEINEKEN wants
to win in all markets with Heineken® and with a full brand portfolio in markets
of choice. The Company is present in over 70 countries and operates more than
165 breweries. HEINEKEN is Europe's largest brewer and the world's third largest
by volume. HEINEKEN is committed to the responsible marketing and consumption of
its more than 250 international premium, regional, local and specialty beers and
ciders. These include Heineken®, Amstel, Anchor, Biere Larue, Bintang, Birra
Moretti, Cruzcampo, Desperados, Dos Equis, Foster's, Newcastle Brown Ale,
Ochota, Primus, Sagres, Sol, Star, Strongbow, Tecate, Tiger and Zywiec. Our
leading joint venture brands include Cristal and Kingfisher. The number of
people employed is over 85,000. Heineken N.V. and Heineken Holding N.V. shares
are listed on the NYSE Euronext in Amsterdam. Prices for the ordinary shares may
be accessed on Bloomberg under the symbols HEIA NA and HEIO NA and on the Reuter
Equities 2000 Service under HEIN.AS and HEIO.AS. HEINEKEN has two sponsored
level 1 American Depositary Receipt (ADR) programmes: Heineken N.V. (OTC: HEINY)
and Heineken Holding N.V. (OTC: HKHHY). Most recent information is available on
HEINEKEN's website: www.theHEINEKENcompany.com.
Disclaimer:
This press release contains forward-looking statements with regard to the
financial position and results of HEINEKEN's activities. These forward-looking
statements are subject to risks and uncertainties that could cause actual
results to differ materially from those expressed in the forward-looking
statements. Many of these risks and uncertainties relate to factors that are
beyond HEINEKEN's ability to control or estimate precisely, such as future
market and economic conditions, the behaviour of other market participants,
changes in consumer preferences, the ability to successfully integrate acquired
businesses and achieve anticipated synergies, costs of raw materials, interest-
rate and exchange-rate fluctuations, changes in tax rates, changes in law,
pension costs, the actions of government regulators and weather conditions.
These and other risk factors are detailed in HEINEKEN's publicly filed annual
reports. You are cautioned not to place undue reliance on these forward-looking
statements, which are only relevant as of the date of this press release.
HEINEKEN does not undertake any obligation to release publicly any revisions to
these forward-looking statements to reflect events or circumstances after the
date of these statements. Market share estimates contained in this press release
are based on outside sources, such as specialised research institutes, in
combination with management estimates.
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Source: HEINEKEN NV via Thomson Reuters ONE
[HUG#1737478]
Unternehmensinformation / Kurzprofil:
Datum: 23.10.2013 - 08:02 Uhr
Sprache: Deutsch
News-ID 308399
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contact information:
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