(News Bulletin 247) – The brewer announced significantly lower sales volumes in the fourth quarter.

Heineken’s publication leaves a bitter taste in the market. The Dutch brewer fell 6.4% around 4:25 p.m. on the Amsterdam Stock Exchange this Wednesday after publishing its fourth quarter results.

For several months, the Batavian group has been selling fewer bottles of beer due, according to it, to unfavorable macroeconomic conditions.

This was again the case over the last three months of 2023. In volume terms, Heineken’s beer sales fell by 3.2% on a comparable basis, to 59.4 million hectoliters. This decline turns out to be much stronger than feared by analysts who were counting on a drop of 2.1%, according to a consensus cited by Royal Bank of Canada.

The Dutch group particularly suffered in Asia-Pacific where volumes fell 10.2% like-for-like.

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Disappointing outlook

Certainly, the price increases allow Heineken to publish revenues up 4.8% over the period to 7.42 billion euros. Over the whole of 2023, the group’s operating margin also increased by 1.7% on a like-for-like basis when the consensus expected this indicator to remain stable.

But in a sector where inflation is bad for consumers, the market remains focused on volumes.

Especially since Heineken delivered disappointing prospects. The group plans to increase its operating profit on a comparable basis in 2024 in a “low to high single digit” range, which can roughly be translated as between 1% and 9%. The width of this range is due to “the volatility of geopolitical and economic conditions that we have observed in past months,” the company explains succinctly.

Not enough to reassure the stock market as the consensus forecast, for 2024, a growth of 9.9% in operating profit. “And this, while investors generally expect that the fall in raw material costs will lead to a significant increase in margins,” underlines Royal Bank of Canada.

“Heineken’s outlook remains gloomy, which translates into forecasts for 2024 that are a little too broad and cautious,” points out the independent research firm AlphaValue.