Sales of Heineken-owned beers fell sharply in the UK at the start of the year after a big price hike but the brewer still collected more revenue
UK revenue for the first three months of the year was up by around 5%, despite sales volume falling by close to 10%, which Heineken put down to both higher pricing and targeting a higher-end segment of the market. The brewer’s Birra Moretti is the UK’s top premium beer by sales value.
There was a similar trend globally, with revenue up 9% to €7.6 billion, despite a 3% dip in sales volume, leading profit to fall to €403 million.
CEO Dolf van den Brink said demand held up better than expected in Europe and the Americas.
“We see the economic environment as volatile and uncertain, making us vigilant and focused,” he added.
Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said the results show that some customers are no longer accepting prices rises.
“When it comes to raising prices, brand power is key – allowing the group to raise prices to combat inflation,” he said. “But Heineken’s beginning to show the first signs that continuous price hikes are leaving a bad taste in consumers’ mouths”
Whether the volume decline is just a blip, or the start of a real deterioration in beer demand will only come to light as the year progresses.”
For the year, Heineken still expects profit growth in the mid-to-high single digits.
Shares are up 2.2% in Amsterdam to €102.10.
