Heineken Holding N.V. reports 2023 half year results
- Revenue growth of 6.3%
- Net revenue (beia) organic growth of 6.6%
- Heineken® volume growth of 1.7%
- Operating profit (beia) organic growth of -8.8%
- Diluted EPS (beia) of €2.03
- Improved operating profit (beia) growth expected in the second half of 2023
- Productivity savings of at least €300 million
- Net profit growth of -8.6%
- Beer volume organic growth of -5.6%
- Operating profit growth of -22.2%
- Net profit (beia) organic growth of -11.6%
- Diluted EPS (beia) growth of -12.0%
- Negative currency translational impact of approximately €780 million
Amsterdam, 31 July 2023 – Heineken Holding N.V. (EURONEXT: HEIO; OTCQX: HKHHY) announces:
Key Highlights |
- The net result of Heineken Holding N.V.'s participating interest in Heineken N.V. for the first half year of 2023 amounts to
€589 million - Revenue growth
6.3% - Net revenue (beia)
6.6% organic growth; per hectolitre12.7% - Beer volume organic growth -
5.6% ; Heineken® volume1.7% growth (excluding Russia3.7% ) - Operating profit growth -
22.2% ; operating profit (beia) organic growth -8.8% - Net profit growth -
8.6% ; net profit (beia) organic growth -11.6% - Diluted EPS
€2.04 ; diluted EPS (beia)€2.03 - FY 2023 outlook updated. Operating profit (beia) stable to mid-single-digit organic growth.
Financial Summary1 |
IFRS Measures | € million | Total growth | BEIA Measures | € million | Organic growth2 | |||
Revenue | 17,436 | | Revenue (beia) | 17,423 | | |||
Net revenue | 14,524 | | Net revenue (beia) | 14,514 | | |||
Operating profit | 1,611 | - | Operating profit (beia) | 1,939 | - | |||
Operating profit (beia) margin | | |||||||
Net profit of Heineken Holding N.V. | 589 | - | Net profit (beia) | 1,150 | - | |||
Diluted EPS (in €) | 2.04 | - | Diluted EPS (beia) (in €) | 2.03 | - | |||
Free operating cash flow | -467 | |||||||
Net debt / EBITDA (beia)3 | 2.7x |
1 Consolidated figures are used throughout this report, unless otherwise stated. Please refer to the Glossary for an explanation of non-GAAP measures and other terms.
Page 15 includes a reconciliation versus IFRS metrics. These non-GAAP measures are included in internal management reports that are reviewed by the Executive Board of Heineken N.V., as management believes that this measurement is the most relevant in evaluating the results. Heineken Holding N.V.’s half year report has not been audited nor reviewed by its external auditor.
2 Organic growth shown, except for Diluted EPS (beia), which is total growth.
3 Includes acquisitions and excludes disposals on a 12 month pro-forma basis.
Heineken Holding N.V. engages in no activities other than its participating interest in Heineken N.V. and the management or supervision of and provision of services to that company.
During the first half of 2023, HEINEKEN focused on executing its EverGreen strategy to deliver superior and balanced growth in a fast-changing world while transforming its business to be future-ready. HEINEKEN is making progress, albeit some short-term challenges given the volatile economic context, with the slowdown of the economy in some countries and unprecedented inflation levels.
HEINEKEN's focus has been on its EverGreen priorities, starting with its dream to shape the future of beer and beyond to win the hearts of consumers. HEINEKEN is also shaping the future with its ambition to become the best digitally connected brewer, raising the bar on sustainability and responsibility and evolving its culture, operating model and capabilities. At the same time, HEINEKEN is stepping up on productivity to fund the investments required for its brands, digitalisation, capabilities and sustainability, and improve profitability and capital efficiency.
HEINEKEN's ambition is to deliver sustained superior growth with a healthy balance between volume and value growth. HEINEKEN aims to achieve this through launching winning beverage propositions in fast-growing consumer segments, building and scaling strong premium brands everywhere and further developing its advantaged geographic and portfolio footprint. This year, HEINEKEN front-loaded significant price increases, often leading the market, to offset unprecedented levels of commodity and energy inflation, which impacted consumer off-take.
Revenue for the first half of 2023 was 17,436 million (2022: 16,401 million). Net revenue (beia) increased
Beer volume for the first half of 2023 decreased
Beer volume | 2Q23 | Organic growth | HY23 | Organic growth | |||||||
(in mhl) | 2Q22 | HY22 | |||||||||
Heineken N.V. | 65.3 | 70.4 | - | 120.1 | 126.9 | - |
Premium beer volume declined by
Heineken® continued to lead HEINEKEN's portfolio and grew volume by
Heineken® volume | 2Q23 | Organic growth | HY23 | Organic growth | ||||
(in mhl) | ||||||||
Total | 14.2 | | 26.3 | |
Outlook Statements |
HEINEKEN's EverGreen strategy is a multi-year and multi-faceted journey to future-proof the company and deliver superior, balanced growth for long-term value creation. HEINEKEN has executed its plans in line with its EverGreen priorities and HEINEKEN is making clear progress in building a premium portfolio, driving consumer-centric innovation, digitisation, sustainability and in improving productivity.
In the second half of 2023, HEINEKEN expects significantly improved operating profit (beia) growth inclusive of:
- Lower pressure from inflation in input costs, transport and energy & water, from mid-teens in the first-half to low-teens in the second-half on a per hectolitre basis
- Pricing starting to moderate with volume trends gradually improving to a low-single-digit decline
- An improved outlook in Vietnam and Nigeria, relative to the significant disruption in the first half
- A similar absolute level of investment in marketing and sales when compared to the first half
- Productivity savings delivering at least
€300 million , cumulatively well-ahead of the€2 billion gross savings target.
Overall, HEINEKEN's updated expectation for the full year of 2023 is stable to a mid-single-digit operating profit (beia) organic growth. HEINEKEN also anticipate an average interest rate for the year of around
Looking ahead, the unprecedented commodity and energy cost inflation in recent years will be partially reversed next year, easing the pressure on pricing. Together with the structural changes HEINEKEN is making with EverGreen, HEINEKEN is confident this will set HEINEKEN up for a balanced growth delivery in 2024, while HEINEKEN remains cautious about the macroeconomic and geopolitical environment. HEINEKEN's strong cost and productivity efforts will continue and enable further support behind its growth agenda, fund investments behind EverGreen and contribute to operating profit growth. Therefore, HEINEKEN's medium-term guidance of superior, balanced growth with operating leverage over time remains unchanged.
Translational Calculated Currency Impact |
Based on the impact to date, and applying spot rates of 27 July 2023 to the 2022 financial results as a baseline for the remainder of the year, the calculated negative currency translational impact would be approximately
Interim Dividend 2023 |
According to the Articles of Association of Heineken Holding N.V. both Heineken Holding N.V. and Heineken N.V. pay an identical dividend per share. HEINEKEN's dividends are paid in the form of an interim dividend and a final dividend. In accordance with its dividend policy, HEINEKEN fixes the interim dividend at
Enquiries |
Media Heineken Holding N.V. | ||
Kees Jongsma | ||
Tel. +31-6-54798253 | ||
E-mail: cjongsma@spj.nl | ||
Media | Investors | |
Sarah Backhouse / Joris Evers | José Federico Castillo Martinez | |
Director of Global Communication | Investor Relations Director | |
Michael Fuchs | Mark Matthews / Chris Steyn | |
Global Corporate and Financial Communications Manager | Investor Relations Manager / Senior Analyst | |
E-mail: pressoffice@heineken.com | E-mail: investors@heineken.com | |
Tel: +31-20-5239355 | Tel: +31-20-5239590 |
Investor Calendar Heineken N.V. |
(events also accessible for Heineken Holding N.V. shareholders)
Trading Update for Q3 2023 | 25 October 2023 | |
Full Year 2023 Results | 14 February 2024 |
Conference Call Details |
HEINEKEN will host an analyst and investor conference call in relation to its 2023 Half Year results today at 14:00 CET/ 13:00 GMT. This call will also be accessible for Heineken Holding N.V. shareholders. The call will be audio cast live via the website: www.theheinekencompany.com. An audio replay service will also be made available after the conference call at the above web address. Analysts and investors can dial-in using the following telephone numbers:
United Kingdom (Local): 020 3936 2999
Netherlands (Local): 085 888 7233
USA: 1 646 664 1960
For the full list of dial in numbers, please refer to the following link: Global Dial-In Numbers
Participation password for all countries: 394664
Editorial information:
Heineken Holding N.V. engages in no activities other than its participating interest in Heineken N.V. and the management or supervision of and provision of services to that company.
HEINEKEN is the world's most international brewer. It is the leading developer and marketer of premium and non-alcoholic beer and cider brands. Led by the Heineken® brand, the Group has a portfolio of more than 300 international, regional, local and specialty beers and ciders. With HEINEKEN’s over 90,000 employees, HEINEKEN brews the joy of true togetherness to inspire a better world. HEINEKEN's dream is to shape the future of beer and beyond to win the hearts of consumers. HEINEKEN is committed to innovation, long-term brand investment, disciplined sales execution and focused cost management. Through "Brew a Better World", sustainability is embedded in the business. HEINEKEN has a well-balanced geographic footprint with leadership positions in both developed and developing markets. HEINEKEN operates breweries, malteries, cider plants and other production facilities in more than 70 countries. Most recent information is available on www.heinekenholding.com and www.theHEINEKENcompany.com and follow HEINEKEN on LinkedIn, Twitter and Instagram.
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Disclaimer:
This press release contains forward-looking statements based on current expectations and assumptions with regard to the financial position and results of HEINEKEN’s activities, anticipated developments and other factors. All statements other than statements of historical facts are, or may be deemed to be, forward-looking statements. Forward-looking statements also include, but are not limited to, statements and information in HEINEKEN’s non-financial reporting, such as HEINEKEN’s emissions reduction and other climate change related matters (including actions, potential impacts and risks associated therewith). These forward-looking statements are identified by their use of terms and phrases such as “aim”, “ambition”, “anticipate”, “believe”, “could”, “estimate”, “expect”, “goals”, “intend”, “may”, “milestones”, “objectives”, “outlook”, “plan”, “probably”, “project”, “risks”, “schedule”, “seek”, “should”, “target”, “will” and similar terms and phrases. These forward-looking statements, while based on management's current expectations and assumptions, are not guarantees of future performance since they are subject to numerous assumptions, known and unknown risks and uncertainties, which may change over time, that could cause actual results to differ materially from those expressed or implied in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond HEINEKEN’s ability to control or estimate precisely, such as but not limited to future market and economic conditions, the behaviour of other market participants, changes in consumer preferences, the ability to successfully integrate acquired businesses and achieve anticipated synergies, costs of raw materials and other goods and services, interest-rate and exchange-rate fluctuations, changes in tax rates, changes in law, environmental and physical risks, change in pension costs, the actions of government regulators and weather conditions. These and other risk factors are detailed in HEINEKEN’s publicly filed annual reports. You are cautioned not to place undue reliance on these forward-looking statements, which speak only of the date of this press release. HEINEKEN assumes no duty to and does not undertake any obligation to update these forward-looking statements contained in this press release. Market share estimates contained in this press release are based on outside sources, such as specialised research institutes, in combination with management estimates.
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FAQ
What was the revenue growth for the first half of 2023?
What is the outlook for the rest of 2023?
What is the diluted EPS (beia)?