Shame on Europe

Is there no end to brewers’ woes in western Europe? Heineken reported on 13 February 2013 that it was thanks to Africa, Asia and the Americas driving volume and revenue growth, that the brewer managed to offset weak European markets in its 2012 financial year.

In the Americas, including Mexico’s FEMSA which Heineken bought in 2010, Heineken sold 4.2 percent more beer. In Africa, where it dominates in Nigeria, volumes rose 3.6 percent. Operating profit in the regions rose 7.9 percent and 9.8 percent respectively.

However, in western Europe, where austerity has accelerated a general decline in beer consumption, volumes fell 2 percent with operating profit down 6.6 percent.

Still Heineken consider themselves lucky as, after taking full control of Asia Pacific Breweries last year, 64 percent of Heineken’s volume and 59 percent of operating profit now come from emerging markets, which puts Heineken on par with AB-InBev.

In 2012 sales rose 3.9 percent, excluding acquisitions and currency swings, while earnings before interest and tax, excluding some items, rose to EUR 2.9 billion (USD 3.8 billion) from EUR 2.7 billion a year earlier, the brewer reported.

Heineken also said they expected to achieve EUR 525 million (USD 693 million) of cost savings under their TCM2 programme from 2012 to 2014 with EUR 25 million of gains from the acquisition of APB now added to their initial target. Heineken had reached EUR 196 million of savings by the end of December last year.

"You have a kind of patchy outlook for Europe… Some countries are more resilient than others," Heineken’s CEO Jean-François van Boxmeer was quoted as saying, adding that premium beers and innovation could still result in higher revenues.