The Heineken stock started trading today with a decrease of almost six percent after the Dutch brewing company reported significantly weaker-than-expected half-year figures and lowered its outlook for the full year.
In the first half of the year, Heineken sold 120.1 million hectoliters of beer, representing a 5.6 percent decline compared to the previous year. The economic slowdown in Vietnam and Nigeria accounted for more than half of the decline in consumption.
Price increases positively impacted revenue, which rose by 6.3 percent to EUR 17.4 billion. However, this was not enough to fully offset the decline in operating profit, which fell by 8.6 percent to EUR 1.16 billion.
Heineken also wrote off an additional EUR 113 million for the planned sale of its Russian operations amounting to a total write off of EUR 201 million. Finding a buyer for this unit remains challenging, the company said.
For the second half of the year, Heineken predicts a decline in sales volume by a low single-digit percentage and anticipates operating profit growth before exceptional items to be between zero and a mid- single-digit percentage.
Analysts view Heineken's performance as weak, especially in the Asia-Pacific region, America, and Europe, where the company significantly missed expectations. However, there were positive aspects, such as strong price development and sales mix in Europe, as well as improved business in Brazil.
Despite today’s loss, the stock is still up by nearly five percent since the beginning of the year.