Pub sales fall 9% with smoke ban

ALCOHOL sales in pubs across the country fell by almost 9% last year, according to figures from drinks group Heineken.

The brewer, which owns the Murphy's stout brand, said during the past five years beer sales in Ireland have declined by 13%.

The new figures come just days after Guinness owner Diageo reported a 10% decline in annual beer and lager sales. Heineken said its beer sales dropped by 6.7% in 2004.

Alcohol sales have been under pressure since the ban on smoking in pubs and restaurants was introduced last March.

However, the drinks industry has seen the sales decline in pubs offset by a rise in off-licence sales.

Heineken Ireland yesterday said that despite the decline in the overall alcohol sales, it has managed to increase its market share by 0.4% to 19.4%.

The company said its turnover in Ireland rose from €305 million to €311m in 2004. Heineken did not disclose the profits made by its Irish division, but, overall, the company's net profits fell 32.7% to €537 million.

Heineken said it was pleased with its performance in Ireland as it managed to grow sales volumes up 0.5% in a declining market.

"The drinks industry is going through a particularly difficult time with changing consumer and societal needs and demands.

"Heineken Ireland has responded to these changes by supporting its trade customers with innovative product developments, new product entries and effective consumer campaigns," said managing director Nico Vervelde.

Heineken said the 8.7% drop in pub sales, which account for four fifths of all alcohol sales, were somewhat offset by the 7% rise in off-licence trade.

And it expects the off-trade to continue to gain a higher share of the overall drinks market.

Heineken said the eponymous lager retains a 30% share of market and a 39% share of the draught lager market.

The company said its Murphy's brand retains its position of second-largest in the stout category, though overall stout sales were down 6.9% in 2004.

Murphy's has a 10% share of the worldwide stout market and is being exported to more than 70 countries.

The company said volumes of Coors Light were up 24% on 2003 figures and its plans to expand the number of bars in Dublin and Cork where it is being sold on draught.

At group level, Heineken said it is planning to spend an extra €100m on marketing campaigns in Europe and the US to boost profits this year. Group turnover was up 8.1% to just over €10bn and volumes were ahead by 13.8%. The company said it did not expect more than mid-single digit growth this year.