Heineken's Sales Volume Poised to Return to Growth, Net Profit to Edge Lower -- Earnings Preview

By Michael Susin

Heineken is scheduled to report results for 2024 on Wednesday. Here is what you need to know.

REVENUE FORECAST: Net revenue before exceptional items and amortization--the company's preferred metric--is forecast to fall to 29.96 billion euros ($30.88 billion) in 2024 compared with 30.31 billion euros a year earlier, according to a company-provided market consensus.

BEER SALES VOLUMES FORECAST: Beer sales volumes--which includes Heineken and more than 300 other brands such as Amstel, Red Strip, Sol or Desperados--are expected to grow 1.3% organically, driven by progress across all geographies while the Asia-Pacific region is expected to outperform with 3.7% growth. This compares with a volume drop of 4.7% in 2023 as the company lifted prices to offset inflationary pressures.

OPERATING PROFIT FORECAST: The Dutch brewer's organic operating profit before exceptional items and amortization is expected to grow 5.3%, according to the same market consensus, in line with the company's guidance of 4% to 8% growth in 2024.

NET PROFIT: Heineken's net profit is expected to sharply drop to 1.39 billion euros from 2.30 billion euros a year, according to a consensus forecast provided by the company. On an adjusted basis, net profit is anticipated to drop to 2.59 billion euros from 2.63 billion euros a year earlier.

The stock is down nearly 30% over the past 52 weeks, trading at levels similar to almost nine years ago.

WHAT TO WATCH:

-- OUTLOOK: For 2025, the Dutch brewer is forecast to report an organic adjusted operating profit growth of 5.8%, according to a consensus forecast provided by the company. Net profit growth is forecast to increase 8.5% organically.

-- NON-ALCOHOLIC TRENDS: The company previously reported double-digit growth on its low and no-alcohol portfolio, amid a downtrend in alcohol consumption as consumers are gradually shifting to non-alcoholic drinks, the opposite picture from nearly five years ago where the pandemic-related lockdowns prompted a surge of alcoholic-beverages demand.

-- PEER COMPARISON: Heineken's annual performance will give further hints about the current industry backdrop following the report a week earlier of its Dutch peer Carlsberg, which beat profit expectations for 2024 as it continued to expand its non-alcoholic portfolio. AB InBev, the world's largest brewer--which makes Budweiser and also houses Stella Artois and Michelob Ultra in its portfolio--is due to report full-year results on Feb. 26.

-- DIVIDEND: Heineken declared a total dividend payout of 1.73 euros a share a year ago.

Write to Michael Susin at michael.susin@wsj.com

(END) Dow Jones Newswires

February 11, 2025 04:49 ET (09:49 GMT)

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