Heineken chilled by weather impact

Heineken suffered a profits hangover in the first half of the year as miserable weather cooled drinkers’ thirst for lager.

The Dutch brewing giant, which owns a range of brands including Foster’s and Newcastle Brown Ale, saw beer sales volumes dip despite the recent heatwave, with spending still subdued amid difficult economic conditions.

Operating profits in western Europe were down 9% on a like-for-like-basis though they were steady across the wider group amid better performances in markets such as Asia and central and eastern Europe.

Heineken also said it had seen encouraging early results from the launch of its “Radler” products – a mix of beer and fruit juice.

The drinks – which have lower alcohol content than beers and are seen as targeting women – were launched in 12 new markets in the period, meaning they are now sold by Heineken in 24 countries.

Revenues in western Europe dropped 5% on a like-for-like basis to €3.6bn on beer volumes down 8%. Operating profits in the region fell by 9% to €362m, compared to the same period in 2012.

Worldwide volumes declined by 3%, with like-for-like revenues down 1%. Net profit before one-off items was €679m, flat on a like-for-like basis as revenue per hectolitre increased 2%.

Chief executive Jean-Francois van Boxmeer said the brewer continued to operate in a “challenging trading environment” but that increasing focus on higher growth regions was delivering, with operating profit in developing markets up 7%.

Heineken last year took full control of Asia Pacific Breweries, maker of Tiger beer.

Mr van Boxmeer said an ongoing focus on costs had delivered €139m of savings in the first half of the year. He was cautious about performance for the rest of 2013, despite the better summer.

“Although the volume trends have improved in July with the warm summer weather in Europe, economic conditions in several of our core markets continue to constrain consumer spending,” he said.