Heineken has reported a worse-than-expected fall in third-quarter beer sales after Covid restrictions cut volumes in Asia and supply chain disruption hit trade in the UK.
The world’s second-largest brewer saw total beer volumes decline 5.1% on a like-for-like basis, a marked slowdown from 9.6% growth over the first half of the year.
In its Asia-Pacific division, sales plummeted 37.4% as the pandemic held sales in Cambodia, Indonesia, Malaysia and Vietnam. Volumes in Vietnam, one of Heineken’s top three markets, fell by more than half after a strict Covid lockdown took its toll on the hospitality sector.
European sales also disappointed, failing to deliver an expected uplift. Heineken said the 2.3% fall in volumes was partly due to poor summer weather in northern Europe, although it also highlighted that it faced logistics disruption from the lorry driver shortage in the UK where volumes were down by a low-single-digit.
Volumes also fell in the Americas (-3.4%), with Africa, Middle East & Eastern Europe the only region in growth (+5.5%).
The company, which is currently implementing its ‘EverGreen’ turnaround plan, retained its forecast of full-year results finishing below pre-pandemic levels of 2019.
In February, Heineken announced 8,000 job cuts along with plans for €2bn worth of cost savings over two years after being hit hard by the pandemic.
CEO Dolf van den Brink warned today that the macro environment remained “volatile” and joined other consumer goods firms in stating that prices of products would have to increase in the face of rising costs and supply chain challenges.
“We are taking an assertive approach to pricing and cost across all of our markets to meet this challenge,” he said.
Rival AB InBev is due to provide an update on its third-quarter tomorrow.
