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Heineken blamed the weather after its sales disappointed in a second quarter also hit by a writedown of its stake in a Chinese brewer, sending shares in the world’s second-largest brewer down 7 per cent.
The Dutch group said the volume of beer it sold in the first half rose 2.1 per, below the 3.4 per cent increase forecast by analysts, after the Euros football tournament failed to deliver a significant boost.
“Typically big sports events like the Euro cup have a positive impact but the weather has been significantly below long-term averages and below last year, impacting our business,” said chief executive Dolf van den Brink.
A weaker second quarter overshadowed what was a strong start to the year from Heineken as it reversed a period of falling sales volumes. The brewer faced criticism for raising prices too high in 2023, leading to a drop in volumes as consumers baulked.
Laurence Whyatt, an analyst at Barclays, said the reaction in the share price on Monday was likely to have been influenced by positive comments made by executives at a recent conference.
“However, these results missed forecasts, suggesting there was a gap between the company’s messaging and analyst expectations.”
Heineken said its revenues increased 2.2 per cent to €17.8bn in the first half of the year. Operating profit before exceptional items and amortisation was better than expected, increasing 12.5 per cent to €2bn in the same period.
Beer sales volumes in Europe rose 0.6 per cent in the first half compared with an expected 2 per cent uplift, with north and western Europe hit hardest.
In the Americas, sales increased 1.1 per cent compared with 3.1 per cent growth anticipated by analysts, driven by growth in Brazil and Mexico, but weighed down by fewer shipments to wholesalers in the US.
Heineken expects to deliver organic operating profit growth of between 4 and 8 per cent for the full year, compared with its previous guidance of between low and high single-digit growth.
The brewer also reported a €874mn impairment on its investment in China’s largest brewer, after softening consumer demand pushed China Resources Beer’s share price lower than the price Heineken paid for its stake.
The impairment led to a net loss of €95mn in the first half of the year for Heineken.
Heineken said it had written down the value of its 20 per cent interest in China Resources Beer after the company’s share price fell significantly, “possibly reflecting concerns on the macroeconomic environment in China and its impact on consumer demand”.
The brewer added that the share price performance had deviated from the strong operational results of China Resources Beer.
