Heineken N.V. reports 2015 half year results
(Thomson Reuters ONE) -
Continued organic revenue and profit growth
Amsterdam, 3 August 2015 - Heineken N.V. (EURONEXT: HEIA; OTCQX: HEINY) today
announced:
* Group revenue +2.0% organically with group revenue per hectolitre up 1.1%
* Group beer volume +1.0% driven by Americas, Asia Pacific and Africa Middle
East
* Heineken® volume in premium segment +4.7% with growth across most regions
* Innovation rate of 8.6%, contributing ?854 million of revenues
* Group operating profit (beia) +4.7% organically
* Consolidated operating profit (beia) +3.4% organically
* Net profit (beia) of ?915 million, up 14% organically
* Diluted EPS (beia) of ?1.59 (2014:?1.34)
CEO Statement
Jean-François van Boxmeer, Chairman of the Executive Board & CEO, commented:
"These solid results are in line with our expectations and demonstrate the
further progress we have made in delivering on our strategy. Despite strong
prior year comparatives and challenging conditions in a number of markets, we
saw positive top line and profit growth. Heineken® volume in the premium segment
grew a further 4.7%, outperforming the total beer market. This continued
positive momentum reflects the benefit from our exposure to high growth markets,
a sustained focus on marketing and innovation, and the ability to drive
efficiencies throughout the business. Our emphasis on innovation delivered ?854
million in revenues. Whilst economic conditions and the pricing environment in
certain key markets remain challenging, we are confident of continued progress
and our full year expectations are unchanged."
FINANCIAL SUMMARY
Key financials(1) HY15 HY14 Total Organic
(in mhl or ? million unless otherwise stated) growth growth
% %
----------------------------------------------------------------------------
Group revenue 10,926 10,196 7.2 2.0
Group revenue/ hl (in ?) 95 90 5.7 1.1
Group operating profit (beia) 1,690 1,560 8.3 4.7
Group operating profit (beia) margin 15.5% 15.3% 20bps
----------------------------------------------------------------------------
Consolidated revenue 9,896 9,274 6.7 1.9
Consolidated operating profit (beia) 1,549 1,454 6.5 3.4
Consolidated operating profit (beia) margin 15.7% 15.7% 0bps
Net profit (beia) 915 772 19 14
Net profit 1,144 631 81
Diluted EPS (beia) (in ?) 1.59 1.34 19
Free operating cash flow 486 571
Net debt/ EBITDA (beia)(2) 2.4 2.5
----------------------------------------------------------------------------
(1 )Refer to the Glossary section for an explanation of non-IFRS measures and
other terms used throughout this report
(2) Includes acquisitions and excludes disposals on a 12 month pro-forma basis
OUTLOOK STATEMENT
(Based on consolidated reporting)
Aside from an adjustment for capital expenditure guidance HEINEKEN reaffirms all
elements of its 2015 outlook, as stated in its FY 2014 release dated 11 February
2015.
In 2015 HEINEKEN expects a continued challenging external environment, however,
delivering on strategic priorities is expected to drive further organic revenue
and profit growth.
Continued revenue growth: HEINEKEN expects positive organic revenue growth in
2015 with volume growth at a more moderate level than 2014, and weighted towards
H2 (tougher comparatives in H1). Continued volume growth in developing markets
will offset more subdued volume growth elsewhere. Revenue per hectolitre is
expected to increase driven by revenue management. Pricing will be limited by
deflationary and off premise pressure in some markets.
Increased commercial investment: HEINEKEN will continue its targeted higher
commercial investments across the regions, and expects a slight increase in
marketing and selling (beia) spend as a percentage of revenue in 2015 (2014:
12.7%).
Continued cost savings: HEINEKEN is committed to delivering further cost savings
and will continue its focus on driving cost efficiencies across the company.
These are an important driver of the medium term margin guidance. As a result of
ongoing productivity initiatives, HEINEKEN expects an organic decline in the
total number of employees in 2015.
Input cost prices are expected to be slightly lower in 2015 (excluding a foreign
currency transactional effect).
Further margin expansion: HEINEKEN continues to target a year on year
improvement in consolidated operating profit (beia) margin of around 40bps in
the medium term. This will continue to be supported by tight cost management,
effective revenue management and the anticipated faster growth of higher margin
developing markets. In 2015 consolidated operating profit (beia) margin will be
adversely impacted by approximately 25bps from the disposal of EMPAQUE, the
Mexican packaging business, which completed in February. HEINEKEN expects to
partially but not fully offset this, such that in 2015 consolidated operating
profit (beia) margin expansion will be somewhat below the 40bps medium term
level.
Foreign currency movements: Assuming spot rates as of 29 July 2015 there is no
material change in the calculated positive 2015 currency translational impact
compared to prior guidance. As such consolidated operating profit (beia) impact
is expected to be approximately ?130 million, and ?80 million at net profit
(beia). However the foreign exchange markets remain very volatile.
Improved financial flexibility: HEINEKEN remains focused on cash flow generation
and disciplined working capital management, with a commitment to a long-term
target net debt/EBITDA (beia) ratio of below 2.5x. In 2015, capital expenditure
related to property, plant and equipment is now expected to be approximately
?1.7 billion (2014: ?1.5 billion), with the ?100 million increase from the prior
guidance due to foreign exchange. A cash conversion ratio of below 100% is
expected in 2015 (2014: 79%).
Effective tax rate: HEINEKEN expects the effective tax rate (beia) for 2015 to
be broadly in line with 2014 (29.7%).
Interest rate: HEINEKEN forecasts an average interest rate of c.3.7% in 2015.
GROUP OPERATIONAL REVIEW
The second quarter saw volume growth, although more moderate than in the prior
year. This was in line with our expectations given the particularly strong
comparatives in the same period last year. Revenue per hectolitre improved
despite limited pricing particularly in Western Europe, and driven by a strong
focus on revenue management. Innovation continued to play an important role in
HEINEKEN's progress contributing revenues of ?854 million in the first half. The
organisational changes announced on 31 March 2015 will allow HEINEKEN to better
focus on growth opportunities, to be more agile in responding to consumer needs
in the marketplace, and to be more cost effective in doing so.
HEINEKEN continues to invest in key developing growth markets. During the first
half of the year the company announced capacity expansion plans in Mexico and
Ethiopia, and opened a new brewery in Myanmar in July.
Group revenue increased 2.0% organically, comprising of a 0.9% increase in group
total volume and a 1.1% increase in group revenue per hectolitre. Adjusting for
negative country mix, revenue per hectolitre would have been up 1.7%. In the
second quarter group revenue grew 1.8% on an organic basis with revenue per
hectolitre up 1.6%, and up 2.1% adjusting for negative country mix.
------------------------------------------------
Group beer volumes 2Q15 2Q14 Organic HY15 HY14 Organic
(in mhl) growth growth
% %
---------------------------------------------------------------------------
Heineken N.V. 55.0 54.6 0.1 98.2 96.6 1.0
Africa Middle East 7.8 7.5 3.7 14.8 14.3 2.8
Americas 14.9 14.8 1.7 28.5 27.6 3.6
Asia Pacific 6.4 6.1 4.2 12.0 11.3 6.1
Central & Eastern Europe 13.9 13.7 -1.7 22.7 22.7 -2.0
Western Europe 12.0 12.4 -3.9 20.2 20.8 -3.0
---------------------------------------------------------------------------
Group beer volume grew 1.0% organically in the first half of the year. As
expected group beer volume growth was more moderate in the second quarter, up
0.1%. Comparatives in the prior year period benefited from favourable weather,
particularly in Western Europe, and the football World Cup. Volume in the second
quarter also included a negative impact from the earlier timing of Easter.
HEINEKEN saw market share gains in several of its key markets including Vietnam,
the Netherlands, Poland, the US, and Brazil.
Heineken® volume 2Q15 Organic HY15 Organic
(in mhl) growth growth
% %
-------------------------------------------------------------------------
Heineken® volume in premium segment 8.2 3.4 14.9 4.7
Africa Middle East 0.9 7.9 1.9 8.6
Americas 2.3 2.6 4.5 5.1
Asia Pacific 1.6 5.3 3.1 7.4
Central & Eastern Europe 0.8 0.1 1.2 -2.1
Western Europe 2.6 2.6 4.2 2.6
-------------------------------------------------------------------------
Heineken® volume in the premium segment grew 4.7%, with positive performances in
almost all regions. In particular, Heineken® volume saw double-digit volume
growth in China, Brazil, Vietnam, Spain and Compañía Cervecerías Unidas S.A.
(CCU) markets. The brand was also strong in key markets such as France, South
Africa, the UK and Taiwan. These results more than offset weaker volume in
Central and Eastern Europe driven by economic uncertainties in Greece and
Russia. Heineken® benefited from the successful campaign to support the UEFA
Champions League football sponsorship. This campaign was activated in 109
markets globally through digital innovation, special edition bottles, and the
Global TV campaign combined with local winning top spins, both awarded at
Cannes. The second half of the year has an exciting pipeline of campaigns to
come including partnering the James Bond movie, sponsorship of the Rugby World
Cup, the continuation of the Cities campaign, and Festive programmes.
The first half of the year saw double digit volume growth of the global brands
Desperados, Affligem and Sol Premium, reflecting the continued focus and success
of the broader premium portfolio strategy. Desperados, the high margin tequila-
flavoured beer, saw particularly strong performance in Poland, France and Spain.
Affligem, the Belgian abbey beer brand, saw strong growth in Western Europe. CCU
markets and Brazil were the key drivers of Sol Premium, the Mexican beer, volume
growth.
Cider volume declined slightly, with the positive volume growth seen in the
first quarter offset by weaker volumes in the second quarter in mainstream cider
in the UK. However, the second quarter saw particularly strong double digit
volume growth in Americas, and positive encouraging volume growth in Ireland and
10 new markets in Central and Eastern Europe. In Americas, the US, Canada and
Mexico were the key drivers of growth. Innovations in the UK including Strongbow
Cloudy Apple and Bulmers Zesty Blood Orange underpinned our leading position in
the home base of cider.
HEINEKEN's focus on innovation delivered ?854 million in revenue and the
innovation rate increased to 8.6% (2014: 7.4%). The company continues to
introduce both global and local brand and packaging innovations across multiple
markets leveraging its worldwide scale. Key themes which remain a focus are
addressing moderation, and improving the quality of the draft offer. 'Radler'
beers continued their strong performance, and the 0.0% variant combined with new
flavours continues to gain momentum with consumers. THE SUB®, the draught beer
appliance, is showing positive signs and will be launched in China, its fifth
market, this month. Brewlock, the on premise dispense system, is showing
positive signs in the US. With a solid pipeline for the remainder of the year,
further strong innovation momentum is expected.
Group operating profit (beia) grew 4.7% organically, primarily reflecting higher
revenues and improved cost efficiencies partly offset by higher planned
marketing and selling expenses.
INTERIM DIVIDEND
In accordance with the existing dividend policy, HEINEKEN fixes its interim
dividend at 40% of the total dividend of the previous year. As a result, an
interim dividend of ?0.44 per share of ?1.60 nominal value will be paid on 12
August 2015. The shares will trade ex-dividend on 5 August 2015.
Enquiries
Media Investors
John Clarke Sonya Ghobrial
Director of Group Communication Director of Investor Relations
Christine van Waveren Marc Kanter / Gabriela Malczynska
Corporate & Financial Communication Investor Relations Manager / Analyst
Manager
E-mail: pressoffice(at)heineken.com E-mail: investors(at)heineken.com
Tel: +31(0) 20 523 9355 Tel: +31(0) 20 523 9590
Investor Calendar Heineken N.V.
What's Brewing Seminar, London 27 August 2015
Trading update for Q3 2015 28 October 2015
What's Brewing Seminar, New York 19 November 2015
Full Year 2015 Results 10 February 2016
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 8256 Local line: +44 (0) 20 3427 1900
National free phone: 0800 020 2577 National free phone: 0800 279 4841
United States of America
Local line: +1 646 254 3361
National free phone: 1 877 280 2296
Participation/ confirmation code for all countries: 2083527
Editorial information:
HEINEKEN is the world's most international brewer. It is the leading developer
and marketer of premium beer and cider brands. Led by the Heineken® brand, the
Group has a powerful portfolio of more than 250 international, regional, local
and specialty beers and ciders. We are committed to innovation, long-term brand
investment, disciplined sales execution and focused cost management. Through
"Brewing a Better World", sustainability is embedded in the business and
delivers value for all stakeholders. HEINEKEN has a well-balanced geographic
footprint with leadership positions in both developed and developing markets. We
employ 81,000 people and operate more than 160 breweries in 70 countries.
Heineken N.V. and Heineken Holding N.V. shares trade on the Euronext in
Amsterdam. Prices for the ordinary shares may be accessed on Bloomberg under the
symbols HEIA NA and HEIO NA and on Reuters under HEIN.AS and HEIO.AS. HEINEKEN
has two sponsored level 1 American Depositary Receipt (ADR) programmes: Heineken
N.V. (OTCQX: HEINY) and Heineken Holding N.V. (OTCQX: HKHHY). Most recent
information is available on HEINEKEN's website: www.theHEINEKENcompany.com and
follow us via (at)HEINEKENCorp.
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,
change in 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 speak only of the date of this press release.
HEINEKEN does not undertake any obligation to update these forward-looking
statements contained in this press release. 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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(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: HEINEKEN NV via GlobeNewswire
[HUG#1943014]
Unternehmensinformation / Kurzprofil:
Datum: 03.08.2015 - 07:00 Uhr
Sprache: Deutsch
News-ID 410933
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contact information:
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