Heineken posted sales and volume growth ahead of analyst forecasts in the first three months of the year, but warned rising energy costs and inflation arising from the conflict in the Middle East could hit demand for its brews in the coming months.
The Dutch brewer delivered year-on-year organic sales growth of 2.8% in the three months to the end of March, slightly ahead of expectations for a 2.3% rise. Volumes, which analysts had predicted to be flat year on year, climbed by 1.2%.
The results were bolstered by impressive showing in Heineken’s Asia-Pacific reporting region. Volume growth hit 10.1%, well ahead of forecasts of a 4.3% rise, helping to offset weaker performance in the Americas (–2.6%) and Europe (–1.8%).
However, the group warned that a “complex and volatile” macroeconomic environment could weigh on profitability and consumer sentiment in future.
“Since the start of the year, global trade has become more complex and volatile, with impacts on energy availability and costs in certain markets,” Heineken CEO Dolf van den Brink said, without directly mentioning the Iran war.
“This leads to inflationary pressures, which might affect consumer sentiment in the medium term,” he added.
In February, Heineken announced plans to cull between 5,000 and 6,000 roles as it looks to offset sluggish demand for beer globally.
The group also cut its forecast for annual profit growth from 4-8% to 2-6% in February, and reaffirmed that guidance today.
“We are monitoring developments closely and actively navigate the year with different evolving scenarios,” Heineken said, adding its outlook was “based on the assumption of a temporary rather than a prolonged disruption in global energy trade”.
RBC Capital Markets analyst James Edwardes Jones described the Q1 showing as “reassuringly uneventful” in a note to clients.
“Overall, Heineken’s Q1 trading was fine, although we note its beat on top-line growth was entirely driven by price,” he said.
There was no update given on Heineken’s search for a new CEO, with van den Brink set to stand down after six years at the helm of the Amstel brewer at the end of May.
Heineken shares were down around 2% in early morning trading.
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