Heineken Hints At Shrinking Consumer Demand: Report

Author: Shivani Kumaresan | October 26, 2022 08:25am

Dutch brewer Heineken N.V. (OTC:HEINY) has hinted at a weakness in consumer demand following its third-quarter FY22 earnings.
Beer volume organic growth of 8.9% for Q3, was below the 11.8% average analyst estimate, Bloomberg reported.
Heineken’s net profit for the first nine months dropped 29% from a year earlier to €2.20 billion.
The company noted that price mix on a constant geographic basis was up 13.2%, driven by pricing to mitigate inflationary pressure and premiumisation effects.
In Q3, revenue was €9.415 billion versus €7.383 billion ayear ago. Net revenue (beia) grew organically by 19.8%, benefitting from the sharp post-COVID recovery in Asia Pacific.
Though brewers cushioned their margins by hiking prices to match inflation, the report specified that customers might find it difficult to handle excessive price rises as higher food and energy cost erode purchasing power.
“We increasingly see reasons to be cautious on the macroeconomic outlook, including some signs of softness in consumer demand," the report cited CEO Dolf van den Brink.
Price Action: HEINY shares closed higher by 2.20% at $43.99 on Tuesday.