Bottoms up: Net profit down but beer sales up for Heineken
Dutch brewer Heineken's net profit is down on last year's figures but higher beer sales contributed to a better than expected performance, its latest results have shown.
The world's second largest beer maker, which includes Tiger and Sol, sold more than expected in its third quarter, but saw its net profits plummet.
The figures
Net profit for the last nine months was down 30 per cent €1.239bn, down from last year's €1.776bn. This is down to a one-time gain of 379m euros from the sale of Mexican packaging operations which boosted previous results.
Their quarter three results said beer volume for the year so far increased 6.9 per cent, and organic beer volume grew by 3.3 per cent since this time last year.
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In the last quarter alone, beer volume grew by 5.4 per cent overall, and two per cent organically.
Why it's interesting
Heineken fared well in most European markets, due to favourable beer-drinking weather.
Its results were largely driven by very growth in emerging markets such as China, South Africa and Brazil. The two per cent growth was higher than the analysts expected, who predicted a 1.4 per cent rise. In September it announced a new company to manage its emerging global brands, after a new Heineken lager was launched in Australia over the summer.
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However, like many global companies, it is battling with a volatile currency market.
It forecast an even heavier currency translation impact, now at 215 million euros at operating profit and 115 million euros at net profit level, from 200 million and 110 million euros seen before.
Share prices
Shares were down 1.2 per cent during morning trading.
What the company said
"Performance in the third quarter was robust despite strong comparatives in Americas and Europe, and a tough environment in Africa Middle East & Eastern Europe," chief executive Jean-Francois van Boxmeer said in a statement.
Our full year margin expectations remain unchanged despite adverse economic conditions in some developing markets, as well as increasing currency headwinds.
Van Boxmeer will be nominated for re-appointment at the brewer's annual meeting.