Heineken toasts profit rise, targets key markets

[THE HAGUE] Dutch brewing giant Heineken on Wednesday posted an 11 per cent jump in net profit for 2014, saying it continued to target key developing countries despite global market volatility.

The world's third largest brewer said net profit climbed to 1.51 billion euros (S$2.32 billion), up 11 per cent from 1.36 billion euros in 2013, while turnover was up 0.1 per cent to 21.19 billion euros.

The company, which owns the Heineken, Desperados, Affligem and Sol brands, said beer sales continued to grow in countries like Mexico, Nigeria, Brazil and Vietnam, partly offset by lower profitability in Poland and by the Chilean-based Compania Cervecerias Unidadas.

"Heineken continues to invest... in key developing markets and added several countries including Ethiopia, Cambodia, China, Vietnam and Indonesia," the Amsterdam-based brewer said.

Profit however was affected last year by dampened growth in Heineken's established markets, particularly in Europe, where bad summer weather and political upheaval affected sales.

The decline in Russia's ruble, together with price pressures in Poland, led to a 7.4 per cent drop in turnover in eastern and central Europe.

Heineken chief executive Jean-Francois van Boxmeer said that overall, Heineken's high-end beer volumes grew by 5.1 per cent and a number of global brands achieved double-digit growth.

Van Boxmeer remained upbeat while warning of a tough year ahead.

"We expect further volatility in emerging markets and deflationary pressures in 2015, (but) we are confident that we will develop further top- and bottom-line growth in the year ahead," he said.

Last September, the family-owned company rejected a takeover bid by British-based rival SABMiller for an unspecified amount, saying it preferred to remain independent and preserve the company's 150-year history.

Valued at around 35 billion euros, Heineken is the world's third-largest brewer after SABMiller and global number one InBev.

Heineken produces and sells more than 200 brands of beer and cider and employs nearly 70,000 people around the world.

AFP