Nigerians Drinking Less Of Heineken’s 62 Billion Liters Of Beer Despite Rise In Sales Globally
Heineken NV, the world’s second-largest brewer, increased beer sales in all four of its global regions in the third quarter and said it stuck to its full-year outlook.
Consolidated beer volume +4.6% organically, with growth in all regions. Heineken® volume +9.2% with double-digit growth in Africa, Middle
East & Eastern Europe and the Americas.
The Dutch maker of Heineken, Europe’s top-selling lager, as well as Tiger, Sol and Strongbow cider, said its consolidated beer volumes rose by 4.6 per cent year-on-year to 62.6 million hectoliters in the July-September period.
The only negative spots were declines of beer sales in Nigeria, a major Heineken market, as well as the Democratic Republic of Congo, Cambodia, Poland and Spain. Heineken lager sales also fell in the Asia-Pacific region.
Brand Spur gathered that in Nigeria beer volume declined high-single digit, driven by increased competitive pressure despite a consolidated beer volume that grew organically by 3.1% in Africa, Middle East & Eastern Europe.
It would be recalled that Jean-Francois van Boxmeer (Executive Board & CEO) admitted that the Heineken is facing tough challenges in Nigeria – one of the brewer’s major international markets. A combination of factors, including the Budweiser launch and a weakened economy from oil price falls, has seen price pressure on the market-leading Heineken lager. Van Boxmeer said problems have been compounded because while Heineken has taken pricing in Nigeria because of duty rises, A-B InBev, which launched Budweiser in the country in April, has not.
The three major players in the Nigerian market Heineken N.V. owners of Nigerian Breweries, AB InBev owners of International Breweries and Diageo-owned Guinness Plc have stepped up their game in their bid to gain market share and profitability. Nigerian Breweries recently launched Tiger Beer into the Nigerian market, International Breweries also introduced Budweiser dubbed king of Beer into the Nigerian market, while Guinness has also increased its Spirit brands in the market.
In South Africa, total volume showed strong double-digit growth, driven by Heineken® and Strongbow brand momentum and an increase in promotional activity. Ethiopia delivered high-single digit beer volume growth despite increased competitive pressure and some social unrest in parts of the country. In Egypt, beer volume was up double-digit driven by increased tourism and a more stable economic environment.
In the DRC, the decline in beer volume moderated to mid-single digit as the business laps prior year price increases. In Russia, beer volume was up mid-single digit, driven by the continued strong growth of our economy brands portfolio and Heineken®.
Jean-François van Boxmeer, Chairman of the Executive Board & CEO, commented: “Volume growth continued in the third quarter, benefiting from good weather in Europe and strong growth in Brazil, Mexico, Vietnam and South Africa. The Heineken® brand continued to outperform, driven by Brazil, South Africa, France and Russia. In August, we announced the signing of non-binding agreements with China Resources to join forces to win in China. Our expectations for the full year 2018 remain unchanged.”