Heineken sees growth regions offsetting weak Europe
BRUSSELS (Reuters) - Heineken (HEIN.AS), the world's third-largest brewer, beat expectations for 2012 profit and said Africa, Asia and the Americas should drive continued volume and revenue growth, offsetting weak European markets.
Europe's largest beer maker also said on Wednesday that savings that should outweigh rising costs.
The brewer of Heineken - Europe's best-selling lager, and Sol, Strongbow and Tiger, said input prices, including malted barley and packaging, would rise only slightly after rising 8.3 percent last year.
Heineken said it expected to achieve 525 million euros of cost savings under its TCM2 program from 2012-14, with 25 million euros of gains from the acquisition of APB now added to its initial target. It had reached 196 million euros of savings by the end of December.
"The higher growth regions of Africa, Latin America and Asia Pacific are expected to more than offset volume weakness in European markets affected by continued economic uncertainty and government-led austerity measures," the company said.
"Last year cost savings were eaten up by input costs. This year, with only a slight increase in input costs, they should boost the bottom line," Bernstein Research analyst Trevor Stirling said. "Some brokers were expecting an earnings miss, with Europe exploding. That did not happen."
Heineken shares, up 41 percent in the past 12 months after falling 3.3 percent in the past week, were up 3.2 percent to 53.62 euros by 0920 GMT, to be one of the top blue-chip risers in Europe .FTEU3.
Its net profit before one-offs rose 7.1 percent to 1.70 billion euros ($2.3 billion), compared with a forecast for 1.65 billion in a Reuters poll.
Like-for-like net profit rose 1.6 percent - Heineken had forecast 2012 profit would be flat on that basis.
After taking full control of Tiger beer maker Asia Pacific Breweries last year, 64 percent of Heineken's volume and 59 percent of operating profit comes from emerging markets, on a par with rival Anheuser-Busch InBev (ABI.BR).
In the Americas, including a large Mexican business bought in 2010, Heineken sold 4.2 percent more beer. In Africa, where it dominates in Nigeria, volumes rose 3.6 percent. Operating profit in the regions rose 7.9 percent and 9.8 percent respectively.
In western Europe, where austerity has accelerated a general decline in beer drinking, volume fell 2 percent with operating profit down 6.6 percent.
Heineken faces a challenge there in 2013.
Drinking in France, where it is the leading brewer, is likely to be hit by a 160 percent increase in duty on beer introduced at the start of the year. In Spain, where it is the number two, rising unemployment and austerity measures have cut drinking, particularly in bars and cafes.
"You have a kind of patchy outlook for Europe ... Some countries are more resilient than others," chief executive Jean-Francois van Boxmeer said, adding that premium beers and innovation could still result in higher revenue there.
($1 = 0.7427 euro)
(Editing by Dan Lalor)
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