Heineken beats expectations in strong Q3

28 October, 2020

Heineken beat analysts’ expectations by reporting a volume sales decline of just 1.9% during the third quarter of 2020.

Analysts expected a 6.6% decline during the three months to September 30 as a result of difficult trading conditions around the world.

Yet the global beer industry has made a swifter than expected recovery after coronavirus lockdowns began to ease in several key markets.

Beer volume is now down 8.1% for the first nine months of the year at Heineken, which is the world’s second largest brewer.

The Heineken brand grew volume by 7.1% during Q3 and it is now up 1% for the first nine months of 2020.

Chairman and chief executive Dolf van den Brink said: “Our performance during the third-quarter continued to be impacted by the Covid-19 crisis. As many lockdowns eased, our volumes improved sequentially compared to the last quarter.

“We outperformed the category across most of our key markets, with Heineken showcasing a stellar performance. We continued strict cost mitigation actions whilst balancing investments behind our brands and future growth opportunities.

“The situation remains highly volatile and uncertain. We expect rolling outbreaks of COVID-19 to continue to meaningfully impact many of our markets in addition to rising recessionary pressures.

“As we navigate the crisis, we are deliberately shaping how to adapt and emerge stronger from the pandemic. I am proud of the relentless drive of our employees and the agility they continue to demonstrate, taking care of one another, our customers, suppliers and communities.”

Volume sales increased by 2.5% in the Americas, but there were declines of 2.4% in Europe, 12.3% in Asia Pacific, and 2.5% in Africa, Middle East & Eastern Europe.

Heineken highlighted Nigeria, Russia, the USA, Brazil, South Korea, Italy and Poland as the best performing markets during Q3.

The reported net profit for the first nine months was €396 million, a sharp decrease from €1.67 billion for the same period in 2019. This was attributed to the impact from lower volume, adverse product and channel mix and incremental expenses driven by the crisis, including credit losses and impairments on tangible and intangible assets, but Heineken said continued cost mitigation actions partially mitigated these challenges.

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