While Heineken didn’t go into much detail about its broader performance in Ireland, the Dutch brewing giant noted that it generated double-digit (when the UK is excluded) group-wide volume growth in cider — it owns the Orchard Thieves brand amongst others — driven by particularly strong sales growth in Ireland, South Africa, and Vietnam.
“Within two years, Orchard Thieves has shaken up the cider category and is now the fastest growing cider brand in Ireland. Its taste and contemporary positioning is relevant to Irish consumers and sets it apart from other brands,” said a Heineken Ireland spokesperson.
“[The Heineken results] and the continued strong growth of its cider volumes in Ireland indicates that the challenging competitive landscape for C&C in the region remains,” said Patrick Higgins of Goodbody Stockbrokers. “We retain our caution on C&C given the competitive market backdrop in Ireland and the difficult outlook for the UK consumer,” he added.
In May, C&C reported a net loss of almost €73m for the year to the end of February. While driven by a further €129m write-down in the value of its US business, the Irish drinks group also said revenues in its core markets of Ireland, Scotland, England and Wales were down for the year.
Yesterday, C&C’s share price — a poor performer over the past year — closed down marginally, having been down by over 3% earlier in the day.
Meanwhile, on a group-wide basis, Heineken reported higher-than-expected earnings in the first half of 2017, with the strongest profit growth in Europe thanks to a late Easter and an early start of warm summer weather.
The world’s second-largest beer maker said volumes, revenue and profits grew on a like-for-like basis in all four of its regions, with turnarounds from weak first quarters in Africa and the Americas. First half operating profit, before exceptional items, grew by 11.8% to €1.81bn, with net profit up 48.6% at €871m and revenue ahead by 5.7% at €10.47bn.
Vietnam, one of Heineken’s top two markets, continued strong. In Europe, where profit growth was strongest, volumes increased in France, Italy, Spain, and Portugal, helped by a late Easter and the warm drink-inducing weather. Heineken said that it continued to expect revenue and profit growth this year despite “volatile” market conditions.
Additional reporting Reuters