Heineken reports solid performance

Heineken, which owns Amstel and Strongbow, has reported a rise in sales for the first half of the year, and says increased investment in marketing is building long-term brand equity.

The company reported an 11% increase in group revenue to €8.4bn (£7.4) and a 4.2% rise in volume sales, seeing increases across all regions, during the period.

Net profit fell 14% to €605m (£529m), down from €700m (£612m) in the previous year.

The Heineken brand volumes increased 4.7% driven by growth in Asia Pacific and Western Europe regions.

The company has increased its marketing in the brand and is rolling out globally. Marketing activity includes sponsorship of the Heineken Cup and UEFA Champions League and the recently launched “Open Your World” advertising campaign, which has been launched in 30 markets.

It plans to continue to increase marketing spend and its focus on long-term brand building.

The company will also continue to invest in innovation for growth and plans to double its innovation rate for the Heineken brand to 6% by 2020.

The company expects performance in the second half of the year to be affected by poor weather in Europe and low consumer confidence.

Jean-François van Boxmeer, chairman and CEO, says: “This is a solid performance for the first half of the year, with higher organic group beer volume across all regions. Our focus on transforming our geographic footprint, aligned with increased marketing investment has enabled us to deliver robust top-line growth and gains in market share.

“Whilst mindful of the continuing volatility and increased uncertainties in the global economy, I remain confident that these efforts combined with our strengthened global platform and higher marketing investments, position the company well to deliver sustainable growth over the long-term.”

Heineken is Europe’s largest brewer and the world’s third largest by volume.

Foster’s reported yesterday that increased investment in its brands and marketing have helped improve the company’s performance as it hopes to stave off a hostile takeover bid by SABMiller.

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