HEINEKEN has once again demonstrated its ability to deliver a positive financial performance despite the challenging economic environment.

Transcription

1 Overview The Quick Read Performance highlights 17,123 million Revenue +6.1% 2,697 million EBIT (beia) +2.8% 1,584 million Net profit (beia) +8.8% million hectolitres Consolidated beer volume +12.8% 27.4 million hectolitres Heineken volume in premium segment +5.4% HEINEKEN has once again demonstrated its ability to deliver a positive financial performance despite the challenging economic environment. Jean-François van Boxmeer Chairman of the Executive Board/CEO EBIT (beia) in millions of EUR Consolidated beer volume in millions of hectolitres Net profit (beia) in millions of EUR Heineken volume in premium segment in millions of hectolitres 2,623 2,697 2,095 1,932 1, ,119 1,013 1,055 1,456 1,

2 Overview The Quick Read continued Key figures 1 Results In millions of EUR Change in % Revenue 17,123 16, % EBIT 3 2,455 2,491 (1.4)% EBIT (beia) 3 2,697 2, % Net profit 1,430 1,447 (1.2)% Net profit (beia) 3 1,584 1, % EBITDA 3 3,623 3, % EBITDA (beia) 3 3,682 3, % Dividend (proposed) % Free operating cash flow 3 2,093 1, % Balance sheet In millions of EUR Total assets 27,127 26, % Equity attributable to equity holders of the Company 5 9,774 9,932 (1.6)% Net debt position 8,355 8, % Market capitalisation 20,605 21,134 (2.5)% Results and balance sheet per share of EUR 1.60 Weighted average number of shares basic 5 585,100, ,234, % Net profit (5.0)% Net profit (beia) % Dividend (proposed) % Free operating cash flow % Equity attributable to equity holders of the Company (5.4)% Share price (2.5)% Employees In numbers Average number of employees 64,252 65,730 (2.2)% Ratios EBIT as % of revenue 14.3% 15.4% (7.1)% EBIT as % of total assets 9.1% 9.3% (3.1)% Net profit as % of average equity attributable to equity holders of the Company % 19.4% (25.3)% Net debt/ebitda (beia) % Dividend % payout % 30.2% 9.5% Cash conversion rate 122.1% 125.6% (2.8)% EBIT (beia)/net interest expenses % 1 Please refer to the Glossary for definitions. 2 Comparatives have been adjusted due to the accounting policy change in employee benefits (see note 2e of the Financial statements, this also applies to other sections of the Annual Report) 3 EBIT, EBIT (beia), net profit (beia), EBITDA, EBITDA (beia) and free operating cash flow are not financial measures calculated in accordance with IFRS. Accordingly, it should not be considered as an alternative to results from operating activities or profit as indicators of our performance, or as an alternative to cash flow from operating activities as a measure of our liquidity. However, we believe that EBIT, EBIT (beia), net profit (beia), EBITDA, EBITDA (beia) and free operating cash flow are measures commonly used by investors and as such useful for disclosure. The presentation on these financial measures may not be comparable to similarly titled measures reported by other companies due to differences in the ways the measures are calculated. For a reconciliation of results from operating activities, profit and cash flow from operating activities to EBIT, EBIT (beia), net profit (beia), EBITDA, EBITDA (beia) and free operating cash flow we refer to the financial review on pages 39 to As at 31 December. 5 Including the effect of the Allotted Share Delivery Instrument (ASDI). 6 Excluding the effect of the ASDI. 02

3 History The story began almost 150 years ago in 1864, when Gerard Adriaan Heineken acquired a small brewery in the heart of Amsterdam. Since 1886 the unique Heineken A-yeast has guaranteed the pure premium taste of Heineken beer. After 13 years of prohibition, in 1933 Heineken became available in America and in 1937 the first Heineken beer was brewed outside the Netherlands, in what was then the Dutch East Indies. Over the ensuing years, growth and acquisitions substantially expanded the Company, firstly in Western Europe and Africa, followed by acquisitions in Central and Eastern Europe and Russia. In 2010, HEINEKEN acquired the beer operations of Fomento Económico Mexicano, S.A.B. de C.V. in Mexico (including its US and other export business) and Brazil, an acquisition that strengthened the Company s leading international portfolio with the addition of Dos Equis, Sol and Tecate. In 2011, HEINEKEN continued to create new platforms for future growth by acquiring five new breweries in Nigeria and two new breweries in Ethiopia. The Company also started brewing Heineken in Mexico and India. Four generations of the Heineken family have been actively involved in the expansion of the Heineken brand and the HEINEKEN Company throughout the world. HEINEKEN today HEINEKEN is a proud, independent global brewer committed to surprise and excite consumers everywhere. Four key attributes make the Company different: Heineken is the first and only truly global beer brand, enjoyed in 178 countries around the world; a unique, worldwide footprint with operations in 71 countries, ensuring a broader reach for our brands than any other brewer; an internationally diverse, dynamic, committed and entrepreneurial team of around 70,000 employees; and the passion of the Heineken family remains as strong today as it was in 1864 when we first started brewing beer. Wherever you are in the world, you are able to enjoy one of our brands. We own, market and sell more than 250 of them. Our principal global brand is Heineken, the world s most valuable international premium beer brand. Other international premium, regional, local and specialty beers include Amstel, Birra Moretti, Cruzcampo, Desperados, Dos Equis, Foster s, Newcastle Brown Ale, Ochota, Primus, Sagres, Sol, Star, Tecate, Zlaty Bazant and Żywiec. Our leading joint venture brands include Anchor, Cristal, Kingfisher and Tiger. In addition to our global portfolio, HEINEKEN is the world s biggest cider maker with brands such as Strongbow Gold and Bulmer s. Where we operate HEINEKEN is the world s most international brewer, thanks to our global network of distributors and 140 breweries in 71 countries. We achieve our global coverage through a combination of wholly-owned companies, licence agreements, affiliates and strategic partnerships and alliances. Some of our wholesalers also distribute wine, spirits and soft drinks. In Europe, we are the largest brewer and our brands are well established in these profitable markets. Due to our acquisitions and joint ventures in Africa, Asia, India and Latin America, we also have a strong platform for current and future growth from these emerging beer markets. 03

4 Overview Our Business Priorities HEINEKEN is focused on five business priorities. Each one helps us to achieve our goal of winning in all markets with Heineken and with a full brand portfolio in markets where we choose. 1. Grow the Heineken brand 2. Consumer-inspired, customer-oriented and brand-led 3. Capture the opportunities in emerging markets The Heineken brand is a key strategic asset and is the undisputed leader in the international premium segment, being twice the size of the nearest competitor brand. Heineken has consistently outperformed the overall beer market and the international premium segment over the past several years. We aim to excite our consumers with effective global marketing platforms, such as the current Open Your World campaign. We continue to explore opportunities to introduce the Heineken brand in new markets in response to a growing consumer demand for high quality, premium beer brands around the world. HEINEKEN is committed to being part of the conversation with consumers and recognised as the preferred partner for its customers. HEINEKEN has more than 250 international, regional, local and specialty beers and other beverages meeting a diverse range of consumer tastes and preferences. We are investing in the expansion of our global brands including Desperados, Strongbow Gold, Amstel and Sol and are increasing the rate of innovation to drive top-line growth. Strong customer management capabilities and world class in-store execution enables HEINEKEN to create value for its customers and drive long-term business success. HEINEKEN has transformed its emerging market presence in recent years through a clear acquisition strategy, strong organic growth and our excellent joint venture partnerships. In Africa, HEINEKEN has operations in 20 countries and exports to virtually all countries in the region. We also have a long-standing presence in Asia Pacific, a region offering attractive growth potential for the international premium segment. We have strengthened our emerging market footprint in the Americas following the acquisition of the beer operations of Fomento Económico Mexicano, S.A.B. de C.V. in Mexico and Brazil. HEINEKEN continues to target future profit growth through exploiting the enormous potential offered in emerging markets. Facebook Heineken is winning in the online space. In December, HEINEKEN and Facebook announced a global partnership, which will see the two companies collaborate on digital campaigns. The Heineken Facebook fan page is already the largest for any beer brand with over five million adult users. Desperados Desperados enjoys a super-premium positioning and differentiation as a tequila flavoured beer. A proven success in existing markets in Europe, it was introduced in 10 new markets in 2011 and benefits from limited sourcing points to maximise economies of scale. Ethiopia In the summer, HEINEKEN acquired two breweries in Ethiopia, one of Africa s most exciting beer markets. Ethiopia is the continent s second most populated country and its beer market has grown approximately 20 per cent per year over the past five years. 04

5 4. Leverage the benefits of HEINEKEN s global scale 5. Drive personal leadership Brewing a Better Future As the world s most international brewer we are investing in new business initiatives aimed at better leveraging the scale of our global operations, including logistics, marketing, purchasing and tax. One example is the recent formation of a Global Business Services (GBS) organisation. The Company has established a HEINEKEN Global Shared Services Centre (HGSS) in Kraków, Poland and HEINEKEN Global Procurement Company (HGP) in the Netherlands. These initiatives will enable HEINEKEN to deliver high quality services to the business, while also delivering operational cost efficiencies. HEINEKEN employs around 70,000 people in 71 countries. As our business grows in scale and complexity, people are a main source of competitive advantage. We need them to think globally, work collaboratively together and to inspire and develop. Speaking a common language and building capabilities from marketing and sales to finance and human resources we are harnessing the power of a geographically diverse team to ensure we win consistently. Integral to enabling the Company to achieve its business objectives is its approach to sustainability. In April 2010 we introduced our Brewing a Better Future approach to creating real sustainable value for all our stakeholders. It has provided the Company with a roadmap and reflects our integrated and long-term ambition to become an even greener business. We focused on three strategic imperatives: Continuously IMPROVE the environmental impact of our business brands; EMPOWER our people and the communities in which we operate; Positively IMPACT the role of beer in society. We want to use our position as the world s most international brewer to help drive positive change and play our role in creating a better world in which we can all live and prosper. Global Business Services In October, the Company announced that it had selected the city of Kraków as the location for its in-house HEINEKEN Global Shared Services Centre. The centre is expected to become operational in HGSS will deliver select business services for transactional finance activities. Building capabilities HEINEKEN will continue to strengthen the capability of its people to achieve its vision. Central to our investment in functional and leadership skills development is building a culture of high performance and achievement that is open to new ideas and learning, encouraging collaboration and innovation. Moderate drinking In December, HEINEKEN launched the latest phase in its global approach to encourage the responsible consumption of its brands. The new advertisement, titled Sunrise belongs to moderate drinkers continues to use Heineken to deliver and reinforce this important message. 05