Heineken Holding N.V. reports 2024 half year results
Amsterdam, 29 July 2024 – Heineken Holding N.V.
(EURONEXT: HEIO; OTCQX: HKHHY) announces:
- Revenue €17,823
million
- Net revenue (beia)
6.0% organic growth; per hectolitre 4.3%
- Beer volume organic
growth 2.1%; Heineken® volume 9.2% growth
- Operating profit
€1,542 million; operating profit (beia) organic growth 12.5%
- Outlook for the full
year updated: operating profit (beia) expected to grow organically
in the range of 4% to 8%.
IFRS Measures |
€ million |
|
Total growth |
|
BEIA Measures |
€ million |
Organic
growth2 |
Revenue |
17,823 |
|
2.2% |
|
Revenue
(beia) |
17,812 |
5.9% |
Net revenue |
14,824 |
|
2.1% |
|
Net revenue
(beia) |
14,814 |
6.0% |
Operating profit |
1,542 |
|
-4.3% |
|
Operating
profit (beia) |
2,079 |
12.5% |
|
|
|
|
|
Operating
profit (beia) margin |
14.0% |
|
Net profit of Heineken Holding N.V.* |
-48 |
|
|
|
Net profit
(beia) |
1,204 |
4.4% |
Diluted EPS (in €)* |
-0.17 |
|
|
|
Diluted EPS
(beia) (in €) |
2.15 |
5.9% |
*Includes non-cash
impairments of €1,050 million in accordance with IFRS (IAS 28 and
36). For more details go to page 20. |
|
Free
operating cash flow |
655 |
|
|
Net debt / EBITDA (beia)3 |
2.4x |
|
1 Consolidated figures are used throughout this report, unless
otherwise stated. Please refer to the Glossary for an explanation
of non-GAAP measures and other terms.
Page 27 includes a reconciliation versus IFRS metrics. These
non-GAAP measures are included in internal management reports that
are reviewed by the Executive Board of
Heineken N.V., as management believes that this measurement is the
most relevant in evaluating the results and in performance
management.
2 Organic growth shown, except for Diluted EPS (beia), which is
total growth.
3 Includes acquisitions and excludes disposals on a 12 month
pro-forma basis.
Heineken Holding N.V. engages in no activities other than its
participating interest in Heineken N.V. and the management or
supervision of and provision of services to that company. The net
result of Heineken Holding N.V.'s participating interest in
Heineken N.V. for the first half year of 2024 amounts to €-48
million.
During the first half of 2024, HEINEKEN continued to execute the
EverGreen strategy and restored balanced growth despite
experiencing economic volatility in certain markets. Growth remains
HEINEKEN's priority and HEINEKEN aspires to shape the future of
beer and beyond to win the hearts of consumers. HEINEKEN also aims
to become the best digitally connected brewer, raise the bar on
sustainability and responsibility and evolve HEINEKEN's
capabilities and culture to embrace future opportunities. To fund
HEINEKEN's growth, and deliver on the EverGreen ambitions, HEINEKEN
continues to drive productivity and capital efficiency in the
pursuit of sustainable, long-term value creation.
HEINEKEN aims for balanced volume and value growth through
building and scaling premium and strategic mainstream brands,
supported by innovation in fast-growing consumer segments,
excellent commercial execution and further developing HEINEKEN's
geographic and portfolio footprint. In the first half of 2024,
HEINEKEN saw encouraging signs of consumer demand stabilising and
was able to restore balanced growth.
Revenue for the first half of 2024 was €17.8
billion, up 2.2%. Net revenue (beia) was €14.8
billion, up 6.0% organically, mainly driven by the growth of
HEINEKEN's largest operating companies in Nigeria, Mexico, Brazil,
Vietnam and India. Total consolidated volume increased 1.7% and net
revenue (beia) per hectolitre was up 4.3% with a positive
contribution from all regions, most notably in Africa & Middle
East. The underlying price-mix on a constant geographic basis was
up 4.9%. Currency translation reduced net revenue (beia) by €625
million or 4.3%, mainly driven by the 48% devaluation of the
Nigerian naira versus the euro. Consolidation changes had a
positive impact to net revenue (beia) of €51 million, the net
result of the Distell and Namibia Breweries acquisitions, the sale
of Vrumona in the Netherlands and HEINEKEN's exit from Russia.
Beer volume for the first half of 2024
increased organically 2.1% versus last year, with all regions
contributing. HEINEKEN gained or held market share in more than
half of its markets. Growth in the second quarter was lower as
Easter fell in the first quarter in 2024 (versus the second quarter
in 2023), competition intensified in the economy segment in Brazil
and poor June weather in Europe.
Beer
volume |
|
|
2Q24 |
|
Organic
growth |
|
|
|
HY24 |
|
Organic
growth |
(in mhl) |
2Q23 |
|
|
|
HY23 |
|
|
Heineken N.V. |
65.3 |
|
62.8 |
|
-0.1% |
|
120.1 |
|
118.2 |
|
2.1% |
Premium beer volume was up 5.1%, ahead of the
total beer portfolio in aggregate and in more than half of
HEINEKEN's markets. The growth was again led by
Heineken®, with further contributions from Kingfisher
Ultra, Dos Equis, Desperados and Birra Moretti, amongst others.
Heineken® grew
volume in the first half by 9.2% with the second quarter up 6.0%.
The growth was broad-based, with more than 27 markets growing
double-digit, most notably Brazil, China, Vietnam and the DRC.
Heineken®
Silver grew volume by more than 40%, led by
Vietnam and China.
The Heineken® brand
continues to be admired for its creativity, in both ideas and
execution. The brand was recognised as the #1 most creative brand
in the alcoholic drinks category and the #2 most creative brand
across all categories at the prestigious Cannes Lions Festival of
Creativity, taking home a record 22 awards. New campaigns included
"The First Ahhh!", celebrating its dedication to the craft of
brewing and the joy at the first sip from a fresh
Heineken®, and "The Boring Phone", noting that the more
refreshing your social life, the more rewarding it becomes.
Heineken® volume |
|
|
2Q24 |
|
Organic
growth |
|
HY23 |
|
HY24 |
|
Organic
growth |
(in mhl) |
2Q23 |
|
|
|
|
|
Total |
14.2 |
|
15.0 |
|
6.0% |
|
26.3 |
|
28.7 |
|
9.2% |
HEINEKEN's EverGreen strategy is a multi-year journey, and
HEINEKEN is pleased with the solid progress in the first half of
2024. While several key emerging markets had to navigate a volatile
macroeconomic environment, overall, HEINEKEN achieved more
balanced, volume- and value-led revenue growth, and good operating
leverage. HEINEKEN also continues to deliver against its
premiumisation, digital and sustainability ambitions, funded by
gross savings and productivity gains.
HEINEKEN continues to expect variable costs to increase
organically by a low-single-digit on a per hectolitre basis. While
HEINEKEN expects to benefit from lower commodity and energy prices
compared to 2023, this is more than offset by local input cost
inflation and currency devaluations, particularly in Africa.
HEINEKEN also expects higher than historical average wage
inflation.
Across the company, HEINEKEN's markets and functions realized
more than €300 million of gross savings in the first half. HEINEKEN
has clear line of sight on its cost saving initiatives and is
therefore confident to achieve its c.€500 million ambition for
2024, ahead of HEINEKEN's medium-term commitment of €400 million
per year.
HEINEKEN is reinvesting a larger proportion of these savings
into marketing and sales. In the second half, HEINEKEN will
materially step-up investment in its brands focused on HEINEKEN's
greatest opportunities for long-term sustainable growth. Notable
increases will be in Mexico, Brazil, Vietnam, India, and South
Africa.
At the same time, volatility remains a reality. Consumer
confidence and economic sentiment in developed markets remain below
their historical average. In the Africa & Middle East region
there is a risk of material currency devaluation in Ethiopia and
hyperinflation in Nigeria and Egypt. HEINEKEN is confident it is
able to adapt, yet this continues to bring some short-term
uncertainty.
Reflecting HEINEKEN's confidence in delivery and commitment to
invest behind growth and in future-proofing its business, HEINEKEN
updates its full year outlook to grow operating profit (beia)
organically in the range of 4% to 8%.
For the full year of 2024, HEINEKEN further expects:
- An effective
interest rate (beia) of around 3.5% (2023: 3.4%).
- As indicated at
HEINEKEN's earlier outlook statement, other net finance expenses
will increase compared to 2023. This is driven primarily by the
impact from significant devaluations and hard currency scarcity in
key emerging markets. HEINEKEN made progress in reducing hard
currency exposures and is on track with the rights issue in
Nigerian Breweries Ltd. If current conditions prevail, HEINEKEN
expects more stable other net financing expenses in the second half
of the year.
- HEINEKEN has updated
its view on the average effective tax rate (beia), and now expect
this to land at around 28% (2023: 26.8%), an improvement relative
to the previous guidance of 29%, including further insights into
Brazil's 2024 tax law changes.
Given the factors above, HEINEKEN revises the expected organic
net profit (beia) growth to be more closely in line with the
expected operating profit (beia) growth.
Finally, HEINEKEN continues to expect investments in capital
expenditure related to property, plant and equipment and intangible
assets to be below 9% of net revenue (beia) (2023: 8.8%).
|
Translational Calculated Currency Impact |
|
|
Based on the impact to date, and applying spot rates of 25 July
2024 to the 2023 financial results as a baseline for the remainder
of the year, the calculated negative currency translational impact
for the full year would be approximately €1.350 million in net
revenue (beia), €170 million at consolidated operating profit
(beia), and €30 million at net profit (beia).
According to the Articles of Association of Heineken Holding
N.V. both Heineken Holding N.V. and Heineken N.V. pay an identical
dividend per share. HEINEKEN's dividends are paid in the form of an
interim dividend and a final dividend. The interim dividend is
fixed at 40% of the total dividend of the previous year. As a
result, an interim dividend of €0.69 per share (2023: €0.69) will
be paid on 8 August 2024. The shares will trade ex-dividend on 31
July 2024.
|
Media Heineken Holding N.V. |
|
|
|
Kees Jongsma |
|
|
|
Tel. +31-6-54798253 |
|
|
|
E-mail:cjongsma@spj.nl |
|
|
|
|
|
|
|
Media |
|
Investors |
|
Joris Evers |
|
Tristan van Strien |
|
Director of Global
Communication |
|
Director of Investor
Relations |
|
E-mail:
pressoffice@heineken.com |
|
Mark Matthews / Chris
Steyn |
|
Tel: +31-20-5239355 |
|
Investor Relations Manager /
Senior Analyst |
|
|
|
E-mail: investors@heineken.com |
|
|
|
Tel: +31-20-5239590 |
|
Investor Calendar Heineken N.V. |
|
|
(events also accessible for Heineken Holding N.V.
shareholders)
|
Trading Update for Q3 2024 |
|
23 October 2024 |
|
Full Year 2024 Results |
|
12 February 2025 |
HEINEKEN will host an analyst and investor conference call in
relation to its 2024 Half Year results today at 14:00 CET/ 13:00
BST. This call will also be accessible for Heineken Holding
N.V. shareholders. The call will be audio cast live via the
website: www.theheinekencompany.com. 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:
United Kingdom (Local): 020 3936 2999
Netherlands (Local): 085 888 7233
USA: 1 646 787 9445
For the full list of dial in numbers, please refer to the
following link: Global Dial-In Numbers
Participation password for all countries: 939700
Editorial information:
Heineken Holding N.V. engages in no activities other than its
participating interest in Heineken N.V. and the management or
supervision of and provision of services to that company.
HEINEKEN is the world's most international brewer. It is the
leading developer and marketer of premium and non-alcoholic beer
and cider brands. Led by the Heineken® brand, the Group
has a portfolio of more than 350 international, regional, local and
specialty beers and ciders. With HEINEKEN’s over 90,000 employees,
HEINEKEN brews the joy of true togetherness to inspire a better
world. HEINEKEN's dream is to shape the future of beer and beyond
to win the hearts of consumers. HEINEKEN is committed to
innovation, long-term brand investment, disciplined sales execution
and focused cost management. Through "Brew a Better World",
sustainability is embedded in the business. HEINEKEN has a
well-balanced geographic footprint with leadership positions in
both developed and developing markets. HEINEKEN operates breweries,
malteries, cider plants and other production facilities in more
than 70 countries. Most recent information is available on
www.heinekenholding.com and www.theHEINEKENcompany.com and follow
HEINEKEN on LinkedIn, Twitter and Instagram.
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Disclaimer:
This press release contains forward-looking statements based on
current expectations and assumptions with regard to the financial
position and results of HEINEKEN’s activities, anticipated
developments and other factors. All statements other than
statements of historical facts are, or may be deemed to be,
forward-looking statements. Forward-looking statements also
include, but are not limited to, statements and information in
HEINEKEN’s non-financial reporting, such as HEINEKEN’s emission
reduction and other climate change related matters (including
actions, potential impacts and risks associated therewith). These
forward-looking statements are identified by use of terms and
phrases such as “aim”, “ambition”, “anticipate”, “believe”,
“could”, “estimate”, “expect”, “goals”, “intend”, “may”,
“milestones”, “objectives”, “outlook”, “plan”, “probably”,
“project”, “risks”, “schedule”, “seek”, “should”, “target”, “will”
and similar terms and phrases. These forward-looking statements,
while based on management's current expectations and assumptions,
are not guarantees of future performance since they are subject to
numerous assumptions, known and unknown risks and uncertainties,
which may change over time, that could cause actual results to
differ materially from those expressed or implied 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 but not limited to 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 and other goods and services, interest-rate
and exchange-rate fluctuations, changes in tax rates, changes in
law, environmental and physical risks, 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 assumes no duty to and 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 external sources, such as specialised
research institutes, in combination with management estimates.
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