Pivnoe Delo
abbey-beer-icon

pivnoe-delo_logo5

Top articles

Journals

4-2017

Global hop market

A local alternative to mass beer suggested by independent brewers has been successful and is now altering the global market. Beer is becoming more diversified, so transnational companies have to accept the new game rules and to switch focus to young and fast growing markets. All these processes increased the demand for aroma and bitter hop as well as their acreage expansion on two continents. However now there appeared a downward trend of alcohol consumption in the world, so even special sorts can soon turn to be sufficient. In this connection the dynamic American hop market is already facing some problems. EU hop producers have become more cautious, they are not racing to exceed the demand and look forward with more confidence, judging by the contract terms. 

Hop Market in Russia

Germany still dominates the Russian market, yet over the recent two years one has been able observe a continuous success of Czech hop suppliers. Their expansion and growing popularity of hops from the United States became the drivers of supplies growth in 2016 despite the preceding modest harvest crop in the EU, as well as the factor of relative stability in 2017. In this connection, in 2017, the ratio of the varieties continued to shift towards the aroma ones, and the supplies of Magnum hop and other alpha varieties were reduced. However, the import of bitter hop pellets is partially replaced by extracts, especially from the major beer manufacturers. Total volumes of alpha acid supplies, according to our estimation, decreased by approximately 5% and returned to the level of 2015. Barth Haas Group continues dominating the hop products market; HVG also increased its weight. At the same time, Morris Hanbury significantly reduced the supplies in 2017.

Heineken N.V. grows net profit (beia) by 19.7% organically in a transformational year

Amsterdam, 16 February 2011 - Heineken N.V. today announced:

  • On an organic basis, a net profit (beia) increase of 19.7%, driven by solid EBIT (beia) growth and lower interest expense; Net profit was up 41% to €1,436 million partly due to changes in consolidation scope;
  • Organic EBIT (beia) growth of 8.6% as cost saving initiatives, improved pricing and sales mix and higher profit from Heineken's joint ventures exceeded the effect of lower volume and revenue;
  • Heineken brand premium volume growth of 3.4%, further strengthening its position as the world's leading international premium beer;
  • Successful completion of the integration of the beer operations of FEMSA. On a pro forma basis, EBIT (beia) of these operations increased 44% to €397 million for the 12-month period ending December 2010. Pre-tax cost synergies of €42 million have already been realised;
  • Total Cost Management (TCM) programme delivered €280 million pre-tax savings in 2010;
  • Strong free operating cash flow generation of €1,993 million resulting in a Net debt/EBITDA (beia) ratio of 2.2x, achieving target of below 2.5x ahead of plan;
  • Proposed total dividend of €0.76 per share for 2010 over an enlarged number of shares outstanding (2009: €0.65).
Key figures 1)
(in hls/ € millions)
FY 2010FY 2009Change %Organic growth %
Group beervolume

192.3

159.1

21

-1.7

Consolidated beer volume

145.9

125.2

17

-3.1

Heineken® premium volume

26.0

25.1

3.4

3.4

 

 

 

 

 

Revenue

16,133

14,701

9.7

-2.2

EBIT

2,476

1,757

41

 

EBIT (beia)

2,608

2,095

25

8.6

Net profit

1,436

1,018

41

 

Net profit (beia)

1,445

1,055

37

19.7

Free Operating Cash Flow

1,993

1,741

14

 

 

 

 

 

 

Net debt/EBITDA (beia)

2.2x*

2.6x

 

 

 

 

 

 

 

Diluted EPS (beia) (in €)

2.56

2.15

19

 

*Including the beer operations of FEMSA on a 12-month pro-forma basis

1) For an explanation of the terms used please refer to the Glossary at the end of the press release

CEO Statement

Jean Fran?ois van Boxmeer, Chairman of the Executive Board and CEO, commented:

"Heineken delivered a robust performance, generating double-digit organic net profit growth for the fifth consecutive year. We achieved this against a backdrop of an improving yet still challenging economic environment in a number of our key markets. At the same time, we have made significant investments in our platform for future growth. The most transformational event being the acquisition of the beer operations of FEMSA which provide us with significant new opportunities in three of the four largest profit pools in the global beer market: Mexico, Brazil and the USA.

I am particularly pleased that the Heineken brand has once again outperformed our broader brand portfolio, the overall beer market and the international premium segment as a whole. We will continue to invest in our leadership position in this segment.

In addition to the acquisition of the beer operations of FEMSA, our new partnership in India and strong growth in Africa and Asia have further enhanced our exposure to emerging beer markets. At the same time we have a clear plan of action for addressing the challenging market and consumer dynamics that exist in Europe and the USA, focusing our efforts on delivering value growth through increased investments in existing and new higher margin brands such as Dos Equis, Desperados and Strongbow. Over time, this is expected to deliver volume and value share growth.

Our success in 2010 was also built upon the significant progress made with our TCM cost saving programme and cash flow generation, enabling us to achieve our long-term Net debt/ EBITDA target ahead of plan. The relentless focus on cost reduction, global synergies and cash flow generation will continue in 2011 and beyond.

I am confident that all these initiatives will provide an excellent platform for revenue and profit growth in the years ahead."

2011 outlook

Heineken expects volume development in Latin America, Africa and Asia to benefit from ongoing robust economic conditions and marketing and investment programmes. Although the Company expects an improving economic environment in Europe and the USA in 2011, the impact of austerity measures and high unemployment is expected to result in continued cautious consumer behaviour in these markets. The international premium segment will continue outgrowing the overall beer market, benefiting the Heineken® brand and supporting improved sales mix. Heineken forecasts a low-single digit increase in input costs and plans to mitigate this impact through increased pricing.

In Europe, Heineken will shift its prime focus towards volume and value share growth, with increased investments in marketing and innovation in Heineken® and other key brands, further supported by the international roll-out of higher margin brands. Whilst this is expected to affect profit development in Europe in the near term, it underlines our commitment to strengthening our leadership position in the region. In addition, continued efforts will be made to improve the performance of companies acquired over the past few years. In the new markets of Mexico and Brazil, improved marketing effectiveness and the realisation of cost synergies will contribute to higher profitability.

The TCM programme will deliver further cost savings, although at a lower level than in 2010 following the earlier than planned realisation of savings in 2010. As a result of ongoing efficiency improvements, Heineken expects a further organic decline in the number of employees.

For 2011, capital expenditure related to property, plant and equipment is forecast to be approximately €850 million.

Heineken does not expect material changes to the effective tax rate (beia) in 2011 (2010: 27.3%) and forecasts an average interest rate slightly above 5.5%.
Free operating cash flow generation is expected to remain strong, further reducing the level of net debt in 2011. Following two consecutive years of substantially reduced capital expenditure and significantly higher cash flow generation, the cash conversion rate for 2011 will be around 100%.

Total dividend for 2010

The Heineken N.V. dividend policy targets a dividend payout ratio of 30%-35% of full-year net profit (beia). The payment of a total cash dividend of €0.76 per share of €1.60 nominal value for 2010 (total dividend 2009: €0.65) on an enlarged number of shares outstanding will be proposed to the annual meeting of shareholders. If approved, a final dividend of €0.50 per share will be paid on 5 May 2011, as an interim dividend of €0.26 per share was paid on 3 September 2010. The payment will be subject to a 15% Dutch withholding tax. The ex-final dividend date for Heineken N.V. shares will be 27 April 2011.

Heineken N.V.

16 Фев. 2011

Advertising

pilsena_en
gea
sidel100x100
jg
portinox

Main topics

Exact matches only
Search in title
Search in content
Search in comments
Search in excerpt
Search in posts
Search in pages
Search in groups
Search in users
Search in forums
Filter by Custom Post Type
Filter by Categories
Home
Magazines
News
×