Cost savings boosted Heineken’s profits

The volume of beer sold declined. The decline was led by a 9.4 percent slump in central and eastern Europe. Volumes in western Europe, the company’s biggest profit contributor, fell 2.5 percent. In Africa and the Middle East, volumes jumped 7.2 percent, the company said, helped by output growth in Nigeria and South Africa. Heineken is working to expand capacity at the Sedibeng brewery, which opened near Johannesburg this year.

In Western Europe, operating profits grew 14 percent to EUR 341 million. In Britain, Heineken’s ownership of Scottish & Newcastle makes it the largest operator.

Heineken attributed improvements in Britain to "better pricing and significant cost reductions," having closed two breweries.

In the U.S., Heineken saw volumes dip 1.7 percent versus a 3 percent fall in the overall market due to "high unemployment and weak consumer confidence."

Dos Equis and Newcastle Brown volumes grew, while Heineken and Amstel declined. Operating profit in the Americas as a whole rose sharply to EUR 223 million due to the FEMSA buy.

In Africa, which has passed the Americas as Heineken’s second most important region by profit, operating profit was up 5.4 percent to EUR 273 million.

Heineken had EUR 9.17 billion in net debt at the end of June.

The company said it remained cautious about beer consumption in Europe and the U.S. due to continued weak consumer spending and planned austerity measures, but expected volumes to grow in Latin America, Africa and Asia.