By Dhirendra Tripathi
Investing.com – Heineken (AS:HEIN) stock rose 1% in Amsterdam as the world’s second-largest brewer reported more-than-doubling of operating profit for the first half of the year.
A cut-back in expenses helped the profits as the company chose to withhold marketing and sales spend in markets that were under lockdown. The company aims to raise those investments and restore them to the levels before the pandemic by 2023.
Beer volumes grew 9.6%, led by 20% growth in Heineken. As many as 50 markets grew in double digits as they reopened after the lockdowns and people stepped out to eat and drink.
The contribution came from Africa, Middle East and Eastern Europe and the Americas. Premium beer volume outperformed the broader portfolio with growth in the mid-teens, led by Heineken.
Heineken Silver more than quadrupled its volume, driven by strong growth in China and Vietnam.
The non-alcoholic beer and cider portfolio grew in high teens as growth continues in Europe, and volume more than doubled in the Americas.
Heineken Chairman and CEO Dolf Van Den Brink warned of higher commodity costs hurting in the current half of the year. He said they will have “. . . a material effect in 2022. Overall, we expect full year financial results to remain below 2019”.
He said COVID-19 remains a factor, with the biggest impact currently in key markets in Asia and Africa.
First-half operating profit came at 1.63 billion euro ($1.92 billion), up 109%. Revenue rose 13.1% to 11.97 billion euro.