Heineken's first-half net profit increases

HEINEKEN REPORTED a jump in first-half net profit despite declining beer volumes and a warning that high unemployment and austerity measures in Europe and the US made it cautious about predicting beer consumption.

The group, the world’s number three brewer by volume, said net profit before exceptional items rose to €621 million in the first six months of the year, an increase of 29 per cent, or 17 per cent on an “organic” basis, which strips out currency fluctuations, consolidation changes and other variables.

For the full year, it said it expected this organic growth rate of net profit would be “at least in low double digits”. René Hooft Graafland, chief financial officer, said the forecast meant the group expected the trends of the first half to continue into the second.

Heineken said management attention was focused on the weak economy, with government austerity measures aimed at cutting budget deficits around the world making its products vulnerable to higher excise duties and weaker consumer purchasing power. Group beer volumes fell 2.3 per cent on a like-for-like basis in the first six months of the year. The group makes over half of its revenues in western Europe from about a quarter of its global beer volume. – (Copyright The Financial Times Limited 2010)