Heineken sees higher earnings despite market volatility

Heineken, the world's third-largest brewer, on Wednesday increased its dividend by more than expected and forecast higher revenues and profits in 2016.

The brewer of Heineken, Europe’s top lager, Tiger and Sol said it would propose a dividend of €1.30 per share, above the €1.10 it paid out last year.

Though the group warned that emerging markets could be volatile in the new financial year, it guided for 2016 revenue and profit growth, with margin expansion seen in line with its medium term target of 40 basis points.

In 2015 the group grew revenues in all of its markets, though operating profit fell in Africa and the Middle East mainly because of fewer tourists visiting the region and economic downturn in Nigeria and the Democratic Republic of Congo.

Operating profit grew fastest in the Americas, especially in Mexico and Brazil where the group raised prices and sold more premium beers.

For the group as a whole, 2015 net profit before one-offs rose 16 per cent to €2.048 billion broadly in line with analyst expectations of €2.052 billion.

Heineken Ireland generated €512.6 million last year on the back of what described as the "strong execution of innovative new product launches".

1. The company’s Irish arm said it had grown its share of the Long Alcohol Drinks (LAD) market by 0.3 per cent, outperforming the market, which saw a decline of 0.1 per cent.

It also described the launch of its new cider, Orchard Thieves, as a big success. “Orchard Thieves now commands 4.3 per cent of total cider and outperformed the declining cider category,” it said.

Carlsberg, the world's fourth-biggest brewer, said earnings will rise this year, helped by growth markets in Asia. Operating profit will rise by a low single-digit percentage on an organic basis, the Copenhagen-based maker of Tuborg beer said in a statement as it reported fourth-quarter earnings that beat analysts' estimates.

Carlsberg is cutting jobs and closing breweries after years of declining profit tied to Russia's shrinking beer market. Turmoil in Ukraine and the ruble's decline have dented consumer confidence in the country, where Carlsberg is the largest beermaker through its ownership of Baltika Breweries.

The company said it will unveil its new strategy for growth to investors on March 16th. Fourth-quarter earnings before interest, taxes and one-time items fell 21 per cent to 1.41 billion kroner ($210 million).

"Our businesses in western and eastern Europe had a challenging year," Cees 't Hart, chief executive since June, said in the statement. "As a consequence of the strong Asian results, however, 2015 marked the inflection point when the growth markets of Asia accounted for a larger part of the group than eastern Europe," he added.