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Heineken N.V. (HEINY) Q4 2023 Earnings Call Transcript

Heineken CEO Dolf van den Brink discusses the company's earning results.

Heineken's policy of putting up prices last year has come back to bite it with volumes down by 5% in 2023 compared to the year before. The Dutch brewer's pricing policies helped it keep revenues moving forward at €36.4bn, up from €31bn, but profits felt the impact falling 4.3% to €2.3bn.

Heineken shares fell on Wednesday after the Dutch brewer reported a slump in the volumes of beer it sold, caused by customers balking at higher prices.

Heineken, the world's second-biggest brewer, warned that persistent inflation and economic worries will weigh on beer demand in 2024. "We see moderate but sequential improvement in our volumes as inflation is starting to come down and consequently the need to take pricing," Heineken CEO Dolf van den Brink told Bloomberg Television.

Here is how Heineken NV (HEINY) and Procter & Gamble (PG) have performed compared to their sector so far this year.

Risks seem noted; this leaves us space for a positive re-rating. HEINY's CFO provides positive volume trends and cost drivers efficiency for 2024. Heineken's margin recovery story should help the company narrow the valuation gap compared to European Staples. Our buy is then confirmed.

The Dutch brewer sold its Russia operations for one euro in August, while consumers globally were deterred by higher beer prices.

Heineken N.V. (EURONEXT:HEIA)'s beer sales volume declined by more than 4% in the third quarter as lower consumer spending and inflation-led price increases bit into all markets across the Americas, Europe and Asia.