Dmitry Nekrasov’s Philosophy — on the Past, Present and Future of Ukrainian Brewing IndustryA meeting with Dmitry Nekrasov always turns into a training course: “Introduction to brewing business“. We are talking to a clever “playing trainer“ a person that can be called a godfather of the Ukrainian craft. He has a dozen of successful projects to his name. Dmitry told us about craft beer in Ukraine, on market cycles, on specifity of operating in retail and HoReCa, on union of Ukrainian brewers and certainly, how a brewery of his own, First Dnipro Brewery is doing.
The market of import beer in Russia: review and databasesThe market of import beer is rapidly growing and changing. But while in the past years it was growing due to brands variety, in 2019 major and affordable brands from TOP-10 were developing actively. It seems that the fact of a brand origin from far abroad counties, even if it is not well known but has moderate price and good distribution provides for million liters of sales in the territory of Russia. Among distributors AB InBev Efes was far behind, yet the role of Baltika and suppliers of the second row got more important. The boom of German brands was followed by stagnation of import from other traditional regions (and Belarus) instead the supplies from Mexico, Lithuania and Asian countries grew considerably.
Russia: Positions of Brewing CompaniesThe review contains an analysis of interim performance of brewers in the first half of 2019. There are rather dynamic changes behind a modest industry growth. Baltika is again experiencing a stage of volumes and market share slid due to competition with AB InBev Efes. Because of the price competition and presence expansion in the modern trade company #2. has come close to the leading position. At the same time sales of Heineken Russia have continued growing which makes the premium part of the portfolio heavier. The market premiumization trend had been also confirmed by import brands. MBC and Zavod Trekhsosenskiy have been the most successful among federal market players. The market share of independent regional brewers and Ochakovo have continued falling as they are being squeezed out by the market leaders at their competitive fields.
Ukrainian beer market 2019: companies and brandsIn 2019 beer production and market have been still fluctuating about zero point. However, the past season was successful for brewers judging by the sales profitability. The price mix has improved due to rapid general market premiumization, as well as its particular aspect, the growth of import beer sales. By the season end AB InBev Efes improved its positions considerably. It turned out that consumers had not forgot Efes brands that had to leave the market, but started to recover rapidly. Against the stagnating market that meant sales decline of other companies, in the first place Carlsberg Group that most of all beneficiated from Efes exiting the market. PPB turned out to be stable to branding activity of its competitor and Obolon kept the same volumes and at the moment it is the absolute leader of the economy segment. The share growth of independent producers took place thanks to leading craft breweries, that so far do not have a big market weight, but they are rapidly gaining it.
Brewing industry in Kazakhstan 2019During the first half of 2019, the majority of Kazakh brewers made their contribution into positive dynamics. Yet it was companies of the lower division, not the two transnational leaders that raised their production and sales. The shares of draft beer and aluminum can which is rapidly squeezing glass bottle out of the market, have been growing. The price segmentation has remained stable despite the substantial rise of retail prices and fluctuations of brand market shares, while the borders between segments have become blurred. The main events in the industry have been: the announced revision of the beer excise policy, launch of BeerKhan brand in the strong beer segment, and most important – purchasing assets of Shymkentbeer by Arasan.
The trend of complication of Russian beer market is going on and in several directions at the same time. The range has got wider, the import and small segments are growing, namely craft beer, alcohol-free beer and special flavor beer. At the same time, all ex-mega brands and light lagers by Russian brewers are experiencing a decline of their shares. AB InBev Efes, Heineken, MBC and Pivzavod Trekhsosenskiy have exceeded the market, Carlsberg was developing slower than the market and Ochakovo as well as some other mid-sized breweries have been cutting down their volumes. To a big extent brewers’ performance was connected to their ability to reach agreement with networks, sacrifice their margin and enter new markets. Craft brewers are facing a serious danger of producers’ registration introduction – de facto licensing. ...
Heineken shows no appetite for Foster’s counterbid
* Prefers to spend money on Mexico, Brazil, Africa or Asia
* No comment on possible counterbid for Foster's
* Heineken shares up 0.4 percent at 40.93 euros
(Adds additional comments from interview, updates shares)
By David Jones and Sara Webb
AMSTERDAM, June 21 (Reuters) - The world's third-largest brewer Heineken appeared to rule out a multi-billion dollar counterbid for Australia's Foster's Group as it said growth outside Europe would come from emerging markets.
The Amsterdam-based brewer of its eponymous beer, Amstel and Dos Equis has made recent acquisitions in the emerging markets of Mexico, Nigeria and Ethiopia, and analysts say it shows little interest in the mature beer market of Australia.
"If you look at our expansion strategy, we see Europe as our home base. Europe is to a large extent profitable, but a very mature market, so you see the expansion we do outside Europe will be in emerging markets," Heineken's Chief Financial Officer Rene Hooft Graafland told Reuters in an interview on Tuesday.
"To do a mature deal completely outside that base is not making sense. Better spend your money on Mexico, Brazil, or Africa or Asian markets," said the 55-year-old, who has spent the last 30 years at the Dutch brewer.
He declined to comment directly on any bid for Foster's.
Global beer giant SABMiller launched a cash bid for the Australian brewer valued at A$9.5 billion ($10.1 billion), excluding debt, which Foster's rejected. Investors predicted Foster's would succumb to a higher offer.
Analysts said family-controlled Heineken did not have the firepower to mount a counterbid after its joint cash takeover of Scottish & Newcastle (S&N) in 2008 and last year's all-share acquisition of Mexico's FEMSA Cerveza.
"S&N made sense because it was predominantly a mature market deal but reinforced our position in Europe with a nice add-on in India, but the biggest part of that acquisition was Europe ... reinforcing our leadership in Europe," Hooft Graafland said.
Heineken shares were up 0.4 percent at 40.93 euros by 1430 GMT while SABMiller was down 3.4 percent at 21.08 pounds compared to a DJ European Food and Beverage index off 0.2 percent.
The group, which brews around a tenth of the world's beer and ranks behind Anheuser-Busch InBev and SABMiller, is looking at growing emerging markets, cost-cutting -- especially in Europe -- and bolt-on brewing acquisitions.
Heineken's three biggest markets are Mexico, Nigeria and Russia, and earns nearly half its profits from emerging markets, diluting its reliance on tough Western Europe beer markets. Heineken is No. 1 in Britain, Italy and the Netherlands.
"The emerging parts will grow faster than the mature markets, so over time you will get more out of emerging markets. At the same time you see the profile of a number of these emerging markets is becoming less risky," Hooft Graafland said.
He declined to comment on Heineken's interest in Schincariol, Brazil's privately owned second-largest brewer, which is reportedly up for sale for $2 billion. The FEMSA deal handed Brazil's No. 3 brewer Kaiser to Heineken.
"In Brazil, you would look at acquisitions, but there is no necessity to do deals," Hooft Graafland said.
He added that with group debt down to 8.1 billion euros at end-2010, and free operating cash flow last year of 2 billion euros, there is firepower to do deals if needed.
(Reporting by David Jones; Editing by Sara Webb, Sophie Walker and David Hulmes) ($1=.6162 Pound) (Reporting by Balazs Koranyi)
22 Июн. 2011