Heineken’s Beer Boost Offset By Higher Aluminum Costs

www.oann.com | 6/12/2018 | Staff
sheenabeanna (Posted by) Level 3
BRUSSELS (Reuters) – Heineken NV on Monday missed estimates for first-half profits, as higher packaging costs offset increased beer sales, but the world’s second-largest brewer stuck with its full-year profit growth forecast.

The Dutch maker of Heineken, Europe’s top-selling lager, said operating profit before one-offs would rise by a mid-single-digit percentage in 2019 after a slim 0.3% increase in the Jan-June period.

Company - Year - Sales - Prices - Consumer

The company said it would benefit this year from increased sales, higher prices and a consumer shift to more expensive beers. But the company also warned input and logistics costs would rise by a mid-single-digit percentage over the year.

Heineken shares, which hit a record high of 104 euros on Friday, were down 6.1% at 96.82 euros at 0720 GMT, making them the weakest performers in the FTSEurofirst 300 index of leading European stocks. They are still up by a quarter this year.

Heineken - Input - Costs - January - June

Heineken’s input costs in the January to June period rose 8.5%, principally for aluminum used in packaging.

Chief Financial Officer Laurence Debroux told Reuters in a telephone interview that the company’s hedges on aluminum had been less favorable than last year’s.

Heineken - Market - Operations - Currency - Material

Heineken’s emerging market operations had also been hit by having to pay hard currency for raw and packaging material with, for example, a weaker Brazilian real.

Costs also increased because of e-commerce investment and an IT upgrade and some sponsorship costs more skewed to the first half of the year.

Half

“If you look at the first half, the...
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