Heineken NV reported better-than-expected beer sales as higher prices did little to stop customers from drinking more amid a rebound at bars, cafes and restaurants.
First-half beer volumes rose 7.6 percent on an organic basis, better than the 5.73 percent average analyst estimate, the Dutch brewer said in a statement yesterday.
The results show that beer drinkers have so far tolerated price increases amid soaring inflation.
Photo: Reuters
Heineken earlier this year said that consumers might cut back on purchases, threatening the industry’s recovery from the COVID-19 pandemic.
“The amount of pricing we and others are taking at some point may start to have an effect and that’s why we’re being cautious,” chief executive officer Dolf van den Brink said in a telephone interview after the earnings report.
The company raised prices by an average of 8.9 percent in the first half from a year earlier and more hikes might come in the remainder of this year, chief financial officer Harold van den Broek said.
Heineken reiterated its outlook for modest growth this year as a rebound in demand is clouded by Russia’s war in Ukraine and price growth pressures. It revised its guidance for next year and now expects mid to high-single-digit organic growth in operating profit.
Organic revenue rose 22 percent to 16.4 billion euros (US$16.8 billion), driven by price increases, good weather in Europe and a recovery in Latin America.
The Dutch brewer reported adjusted net profit of 1.33 billion euros for the first half, an organic growth of 40 percent from a year earlier.
Heineken has previously said it expects an impairment of 400 million euros due to its retreat from Russia amid the war in Ukraine.
“Progress has been made on an orderly transfer of our business to a new owner and an agreement is expected to be reached in the second half of the year,” the company said.
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