Business

Heineken cheers 2017 profits, but margin growth to lose fizz

Wednesday, February 14, 2018

Print this page Email A Friend!


LA HAYE, Netherlands (AFP) — Dutch brewing giant Heineken said Monday that profits jumped by a quarter in 2017, thanks to higher sales of its premium-brand beer across nearly all regions.

Heineken said in a statement that its net profit rose by 25.6 per cent to 1.93 billion euros (US$2.4 billion) last year on a 5.3-per cent increase in sales to 21.9 billion euros.

“We delivered strong results in 2017, with all the regions contributing to organic growth in volume, revenue and operating profit,” Heineken's chief executive Jean-Francois van Boxmeer said.

“The Heineken brand performed very well, and Heineken 0.0 (non-alcoholic beer) was launched in 16 countries,” he said in a statement.

Sales of its premium brand were up 4.5 per cent, “one of the brand's strongest performances in recent years, with positive volume performance across all regions apart from Asia Pacific,” the Amsterdam-based group said.

The brewer was also making inroads in the low-alcohol beer sector, with Heineken 0.0 “delivering ahead of expectations”, with Van Boxmeer telling a teleconference, “We see significant potential in the market.”

But Heineken said its operating profit margin will expand about 25 basis points below the targets set for previous years, mainly because of a headwind, as it integrates a business in Brazil that it bought from rival Kirin for US$666 million, the Bloomberg news agency reported.

Heineken's share price was down by 2.0 per cent in noon trade on the Amsterdam stock exchange's AEX index, recovering from a fall of almost 4.0 per cent shortly after opening.

Founded in the 19th century, Heineken produces and sells more than 250 brands, including Desperados tequila-flavoured beer, Sol, John Smith's, and Strongbow cider, and employs about 80,000 people in 70 countries around the world.

It announced a range of different acquisitions last year, including Punch Taverns in Britain and Brasil Kirin in Brazil, as well as Lagunitas in the US.

Looking ahead, Heineken warned that 2018 will “continue to be marked by volatility and uncertainty” and it warned of a “negative impact from currency compared to 2017... as foreign exchange markets remain very volatile”.

Nevertheless, the brewer said it would propose paying an increased dividend of 1.47 euros per share for 2017, compared with 1.34 euros for 2016.

ADVERTISEMENT




POST A COMMENT

HOUSE RULES

1. We welcome reader comments on the top stories of the day. Some comments may be republished on the website or in the newspaper � email addresses will not be published.

2. Please understand that comments are moderated and it is not always possible to publish all that have been submitted. We will, however, try to publish comments that are representative of all received.

3. We ask that comments are civil and free of libellous or hateful material. Also please stick to the topic under discussion.

4. Please do not write in block capitals since this makes your comment hard to read.

5. Please don't use the comments to advertise. However, our advertising department can be more than accommodating if emailed: advertising@jamaicaobserver.com.

6. If readers wish to report offensive comments, suggest a correction or share a story then please email: community@jamaicaobserver.com.

7. Lastly, read our Terms and Conditions and Privacy Policy



comments powered by Disqus
ADVERTISEMENT
here:1056

Poll

ADVERTISEMENT
ADVERTISEMENT

Today's Cartoon

Click image to view full size editorial cartoon
ADVERTISEMENT