Heineken, the world's second largest brewer, fared better than expected at the start of 2021 as increased beer sales in Africa and Asia offset a sharp decline in Europe.
The maker of Europe’s top-selling lager Heineken, Tiger and Sol retained its outlook that the impact of the Covid-19 pandemic was significant and markets should gradually improve in the second half of 2021, depending on vaccine rollouts.
The Dutch brewer sold 50.3 million hectolitres of beer in the first quarter, unchanged from a year earlier on a like-for-like basis. The average forecast in a company-compiled poll was for a 5 per cent decline
Sales in Africa, the Middle East and Eastern Europe jumped 9.9 per cent, with particularly strong performances in Nigeria and South Africa, growth in the former held back by supply constraints and expansion in the latter despite alcohol bans in January and over the Easter weekend.
Asian sales were 5.4 per cent higher, principally in southeast Asia and including Vietnam, one of the company’s largest markets.
Sales in the region did grow in the first quarter of 2020, although collapsed in March as the coronavirus spread.
In Europe beer sales fell by 9.7 per cent as lockdowns cut drinking in cafes and restaurants by two-thirds.
Growth in sales from stores has not made up for the shortfall. Brewers have also suffered from the higher cost of packaging in single-use cans rather than cheaper returnable bottles or kegs.
Net profit in the first quarter was €168 million, nearly 80 per cent higher than a year earlier, but more than 40 per cent lower than the 2019 figure, with European weakness offset by other regions and cost controls helping.
The brewer has launched a three-year plan to restore profit margins to pre-pandemic levels, partly through cutting 8,000 jobs.
