Heineken Holding N.V. Trading Update First Quarter 2009

Wednesday, 22. April 2009 07:07
Amsterdam, 22 April 2009 - Heineken Holding N.V. today issued its
scheduled trading update for the first three months of 2009. Better
selling prices largely compensated for lower volumes, resulting,
organically, in an EBIT (beia) only marginally lower.


* Heineken's* revenue grew 24% to EUR3,046 million; organically,
revenue declined 1%;
* Organically, EBIT (beia) decreased by low single digits,
demonstrating the continued resilience of the existing business
through the current recession. The effect of first time
consolidations led to a total decline in EBIT (beia) in the high
teens;
* Consolidated beer volume grew 12%; organically, volume declined
6.3%;
* Heineken® brand volume in the international premium segment was
lower by 5.8%;
* Positive contribution from Heineken N.V.'s Total Cost Management
(TCM) saving programme.


In the first quarter of 2009, revenue increased 24% compared with the
first quarter of 2008 owing to first-time consolidations (+27%) and
better pricing (+6%). This was partially offset by the financial
impact of lower volume (-7%) and unfavourable exchange rate
fluctuations (-2%). Organically, revenue decreased 1%.

Heineken's full-year results and volumes are far more dependent on
the performance in the peak-selling season (May-August). The first
quarter is the least significant in terms of volume and
profitability. In 2007 and 2008, the first quarter accounted for 20%
and 18% of annual consolidated beer volume respectively.

Results

Organically, EBIT (beia) decreased in the low single digits. Higher
selling prices and effective cost management linked to Heineken
N.V.'s TCM programme contributed positively. Inflation in personnel
expenses and higher depreciation were partly offset by a decline in
other fixed expenses. Marketing and selling expenses as a percentage
of revenue remained stable as a result of optimised marketing
investments and lower media rates, which were balanced with higher
marketing spending in the USA.

Heineken N.V.'s TCM programme is already starting to contribute to
profit via cost reduction in the supply chain. The realisation of S&N
cost synergies is developing in line with expectations.

EBIT (beia) declined in the high teens, mainly as a result of first
time consolidations. Exchange rate translations had a modest positive
effect.

Exceptional items after tax were limited, totalling EUR11 million
related to the negative fair value effect of interest swaps. The
amortisation of brands amounted to EUR18 million.
Net profit (beia) was lower due to higher financing costs associated
with newly acquired businesses and lower EBIT (beia).

Beer volumes

Consolidated beer volume grew 12%, due to the first-time
consolidation of Scottish & Newcastle and other acquired businesses.
Organically, consolidated beer volume declined 6.3% as lower volumes
in Europe and the Americas were only partly offset by continued
strong volume growth in Africa and, to a lesser extent, Asia-Pacific.

Organic volume was adversely impacted by a combination of factors
including the global economic downturn, unfavourable weather, the
continued effect of smoking bans, distributor destocking, excise duty
increases and selling price increases. Consistent with its long-term
strategy on building brands, Heineken will continue to maintain the
price positioning of its key brands.

Volume of the Heineken® brand in the international premium segment
declined 5.8% to 5.3 million hectolitres mainly due to the recession
in Europe and down trading in the USA.

Priorities for 2009 and beyond

The final impact and duration of the global economic downturn remains
unclear. Therefore, Heineken will maintain a rigorous focus on:

* Reducing debt through initiatives that strengthen cash generation
and conversion
* Improving performance of newly acquired companies
* Reducing costs through Total Cost Management
* Maintaining the price positioning of key brands
* Increasing the efficiency and effectiveness of all marketing
investments


Volume development by region


Million 2009 First Organic
hectolitres quarter 2008 First Change Change
quarter
Western Europe 9.5 6.6 43% -9.8%
Central and 9.0 9.6 -6.3% -12%
Eastern Europe
Africa and the 4.6 4.0 16% 16%
Middle East
The Americas 1.9 2.1 -8.9% -16%
Asia Pacific 0.6 0.6 3.3% 3.4%
Consolidated beer 25.6 22.9 12% -6.3%
volume

Group beer volume 34.4 31.5 9.0% -5.2%

Heineken® premium 5.3 5.7 -5.8%
volume


In Western Europe, volumes declined organically across all markets.
In particular, volumes in the Netherlands were affected by a
substantial excise duty increase from 1 January 2009. In Italy,
performance was impacted by temporary delisting by several retailers
during price negotiations. Spain, France and Ireland performed
relatively well versus the regional average.
The UK beer market continued to be under pressure, but cider volume
grew strongly.

In Central and Eastern Europe, organic volume growth was negative
across most markets. Volumes in Russia, Romania and Greece developed
in line with the regional average. Poland performed better than the
regional average, whilst Austria performed below the regional
average.

Volume in Africa and the Middle East grew 16%. All key markets showed
ongoing robust growth with strong performances in Nigeria, Egypt and
the Democratic Republic of Congo.
Volume in South Africa continues to grow strongly.

In the Americas, total consolidated beer volume fell 8.9%. In the
USA, volumes of the Dutch brand portfolio were lower whilst volumes
of the Mexican brand portfolio grew slightly. Depletions (sales by
distributors to retailers) were slightly better than sales volume.
Volume across the Caribbean dropped due to lower tourist numbers
whilst volume in Central America grew strongly.

Organically, consolidated beer volume grew 3.4% across the Asia
Pacific region. Multi Bintang Indonesia, New Caledonia, exports and
licensing all enjoyed good growth. The joint ventures, Asia Pacific
Breweries and UBL (India), performed well.

Financial structure

On 17 February, Heineken obtained a fully committed two-year stand-by
revolving credit facility of EUR250 million, subsequently increased
to EUR375 million after syndication.
Under its European Medium Term Note (EMTN) programme, Heineken placed
6-year 7.25% Sterling Notes for a principal amount of GBP400 million
(EUR450 million) on 26 February. Most of the proceeds have been
swapped into fixed-rate Euro, with an effective interest rate below
7%.

On 25 March, Heineken placed 5-year Euro Notes for a principal amount
of EUR1.0 billion with a coupon of 7.125% under the same EMTN
programme.

As a result of these financing activities and internally generated
cash flows, Heineken has sufficient financial resources to cover debt
repayments for the next 36 months.

Heineken Holding N.V. agenda
Annual General Meeting of Shareholders (AGM) 23 April
2009
Quotation ex-final dividend
2008 27 April 2009
Final dividend 2008
payable 4 May 2009
Financial results for the first half 2009
26 August 2009
Trading update for the third quarter 2009
28 October 2009

2008 quarterly breakdown of beer volume and revenue


Million hectolitres Q1 Q2 Q3 2008 Q4
2008 2008 2008
- Western Europe 6.6 12.6 13.6 11.5
- Central and Eastern 9.6 15.3 15.2 10.4
Europe
- Africa & Middle East 4.0 4.4 4.6 5.1
- Americas 2.1 2.8 2.7 2.7
- Asia/Pacific 0.6 0.6 0.8 0.6
Consolidated beer 22.9 35.7 36.9 30.3
volume
Group beer volume 31.5 44.5 45.8 39.7
Heineken® premium 5.7 7.2 7.0 6.0
volume
Revenue (EUR million) 2,467 3,944 4,235 3,673


Heineken will host an analyst and investor conference call in
relation to this trading update today at 10:00am CET/ 9.00 BST. The
call will be audiocast live via the company website
http://www.heinekeninternational.com/webcast/investors, and will be
available for download afterwards. Analysts and investors can call in
using the following telephone numbers:

From The Netherlands: From United
Kingdom
Toll Free: 0800 - 265 8528 Toll Free:
0800 - 358 5263
Local line+31 (0)20 - 794 8504 Local line: + 44
(0) 20 7190 1595

Editorial information:
Heineken N.V. is one of the world's great brewers and is committed to
growth and remaining independent. The brand that bears the founder's
family name - Heineken - is available in almost every country on the
globe and is the world's most valuable international premium beer
brand. Heineken's aim is to be a leading brewer in each of the
markets in which it operates and to have the world's most prominent
brand portfolio. In 2008, Heineken operated 125 breweries in more
than 70 countries and sold 162 million hectolitres of beer. Heineken
is Europe's largest brewer and the world's third largest by volume.
Heineken is committed to the responsible marketing and consumption of
its more than 200 international premium, regional, local and
specialty beers and ciders. These include Amstel, Birra Moretti,
Cruzcampo, Foster's, Maes, Murphy's, Newcastle Brown Ale, Ochota,
Primus, Sagres, Star, Strongbow, Tiger and Zywiec. In 2008, revenue
totalled EUR 14.3 billion and Net Profit before exceptional items and
amortisation was EUR 1.0 billion. In 2008, the average number of
people employed was 56,208. Heineken N.V. and Heineken Holding N.V.
shares are listed on the Amsterdam stock exchange. Prices for the
ordinary shares may be accessed on Bloomberg under the symbols
HEIA:NA and HEIO:NA and on the Reuter Equities 2000 Service under
HEIN.AS and HEIO.AS. Additional information is available on
Heineken's home page: http://www.heinekeninternational.com.

Press enquiries
Véronique Schyns
Tel: +31 (0)20 5239 355
veronique.schyns@heineken.com

Investor and analyst enquiries
Jan van de Merbel
Tel: +31 (0)20 5239 590
investors@heineken.com

* Heineken means Heineken Holding N.V., Heineken N.V., its
subsidiaries and interests in joint ventures and associates


This announcement was originally distributed by Hugin. The issuer is
solely responsible for the content of this announcement.

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Author:
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