Heineken Sales Miss Forecasts as Consumers Shy Away From Beer -- Update

Dow Jones10-23

By Michael Susin and Mauro Orru

Heineken posted sales below analysts' expectations in the third quarter as consumers' thirst for beer waned, particularly in the Americas and the Asia Pacific.

The Dutch brewer on Wednesday reported revenue of 9.07 billion euros ($9.80 billion) for the quarter, down 5.5% on year. Net revenue before exceptional items and amortization--more closely watched by investors--grew 3.3% organically to 7.68 billion euros.

Analysts had forecast adjusted net revenue of 7.78 billion euros, according to a market consensus provided by the company. Chief Executive Dolf van den Brink said Heineken had been navigating challenging consumer and industry trends in some markets.

Drinkers in many parts of the world, where inflation and pricing remain relatively high, are spending less on alcoholic beverages. Adjusted net revenue grew 1.8% organically in the Americas, with Brazil leading the charge. However, sales declined by a low-single-digit in the U.S. amid softer demand for beer.

In the Asia Pacific, sales slipped 0.4%. Heineken said a sharp beer market decline in Cambodia had harmed the quarter in the region despite growth in China, where Heineken Original and Heineken Silver fared well.

Sales in Europe fell 1.1% organically. However, beer volume--a key measure of the amount of beer the company produces and sells--increased 1.4% there, in contrast with declines in the Americas and the Asia Pacific. The volume of premium beer grew by a mid-single-digit percentage in Europe, led by Birra Moretti, Desperados and Heineken.

The group posted 23.1% organic sales growth in Africa and the Middle East, led by Nigeria, South Africa and Namibia.

Van den Brink said Heineken remained on track for its 500-million-euro gross savings target this year.

The group said it continued to expect operating profit before exceptional items and amortization to grow 4% to 8% organically for the year, with organic growth in net profit before exceptional items and amortization expected to be closely in line.

Write to Michael Susin at michael.susin@wsj.com and Mauro Orru at mauro.orru@wsj.com

(END) Dow Jones Newswires

October 23, 2024 03:14 ET (07:14 GMT)

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Heineken Sales Miss Forecasts as Consumers Shy Away From Beer -- Update

Comments