• Thursday, March 28, 2024
businessday logo

BusinessDay

Heineken shrugs off intense Nigeria beer wars to record double digit growth

chart1

Dutch brewer Heineken, maker of Europe’s top-selling lager brands, has announced that beer sales increased across all regions, in its 2018 earnings report.

According to the result, net revenue before exceptional items and amortisation (beia) increased to 6.1%, while total consolidated volume increased by 4% and revenue (beia) per hectolitre increased by 2%.

Consolidated beer volume grew by 4.2% in 2018, with a 4.5% growth in Q1 and 4% growth in Q2. Beer volume increased in Q4 to 3.3% against a comparable base of Q4 results of 4.6% in 2017.

Heineken volume grew to 7.7%, its strongest performance in more than a decade. While the volume of Heineken sold in Nigeria, Brazil, South Africa, Russia, the UK, Mexico, Poland and Germany doubled in growth.

Heineken CEO and chair of the executive board Jean-Francois van Boxmeer noted that the company delivered another remarkable growth in 2018 despite challenges in some markets.

“In 2018 we delivered another year of superior top-line growth. The Heineken brand grew 7.7%, its best performance in over a decade, with Heineken 0.0 now available in 38 countries” he said.

According to the report, Cider volume increased double digit to 5.6 million hectolitres as against 4.9 million hectolitres in 2017. In the UK volume grew mid-single digit and outside of the UK volume reached more than 2 million hectolitres. Strongbow and its flavour variants continue to gain share in South Africa. Performance of the company’s recently introduced Ladrón de Manzanas in Spain and Strongbow in Vietnam is promising.

Also the Low & No-Alcohol brands, volumes increased mid-single digit, delivering 13.1 million hectolitres in 2018 as against 12.5 million hectolitters in 2017. In Europe volumes grew high-single digit due to the continued success of Heineken and Radler. While in Ethiopia, Sofi Malt and its new coffee variant Sofi Buna boosted the growth of the LNA portfolio. Volumes in Nigeria were adversely impacted by the weak macro-economic environment.

The Dutch brewer’s shares rose as much as 4.88 percent to end trading at £86.24 Wednesday, after it reported full-year earnings that beat analysts’ estimates.

The Nigerian beer market has seen an intense battle for market share by the three major players. Heineken is gaining grounds in countries that have been dominated by AB InBev, which is grappling with a mountain of debt from its takeover of SABMiller Plc.

 

OLUFIKAYO OWOEYE