Heineken Net Profit 11.2% Higher at EUR 795 Million; Heineken Brand Driving Force behind Profit Improvement.Business Editors AMSTERDAM Amsterdam, city, Netherlands Amsterdam (ăm`stərdăm', Dutch ämstərdäm`), city (1994 pop. 724,096), constitutional capital and largest city of the Kingdom of the Netherlands, North Holland prov. , The Netherlands--(BUSINESS WIRE)--Feb. 26, 2003 Heineken:
2002 2001 increase
Net profit EUR 795 million EUR 715 million 11.2%
Net turnover EUR 10.293 billion EUR 9.333 billion (1) 10.3%
Operating profit EUR 1.282 billion EUR 1.125 billion 14.0%
EBITDA EUR 1.811 billion EUR 1.601 billion 13.1%
Operating profit
as a percentage 40 basis
of net turnover 12.5% 12.1% points
Net profit per EUR 2.03 EUR 1.82
share 11.2%
Dividend per EUR 0.40 EUR 0.40 unchanged
share
((1)Restated for comparison purposes)
Group volume*) amounted to 84.8 million hl in 2002, an increase of 4.8% compared with the previous year. Total beer volume of the Group (Group volume plus beer sales by affiliated companies Affiliated Companies A situation that occurs when one company owns a minority interest (less than 50%) in another company. Also refers to companies that are related to each other in some way. Notes: An affiliated company is sometimes referred to as a subsidiary. ) increased to 108.9 million hl (2001: 105.1 million hl). In the countries where Heineken beer is positioned in the premium segment, sales volume increased by 4.5%. Higher growth was achieved in The United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Poland Poland, Pol. Polska, officially Republic of Poland, republic (2005 est. pop. 38,635,000), 120,725 sq mi (312,677 sq km), central Europe. It borders on Germany in the west, on the Baltic Sea and the Kaliningrad region of Russia in the north, on Lithuania, and Thailand Thailand (tī`lănd, –lənd), Thai Prathet Thai [land of the free], officially Kingdom of Thailand, constitutional monarchy (2005 est. pop. 65,444,000), 198,455 sq mi (514,000 sq km), Southeast Asia. . Lower sales in the United Kingdom restricted the growth of worldwide Heineken beer sales to 22.9 million hl (+2.5%). This week, Heineken will be introduced in the premium segment in the United Kingdom. Higher sales of Amstel The Amstel is a river in the Netherlands which runs through the city of Amsterdam. The Amstel's name is derived from Aeme stelle, old Dutch for "area abounding with water". in Africa and Amstel Light in the United States, where it is positioned in the premium segment, compensated for reduced volume in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , resulting in sales of Amstel beer remaining
stable at 10.8 million hl.
"Healthy numbers and another year of consistent growth" "The full-year results for 2002 are proof of the continuing success of our strategy," says Thony Ruys, Chairman of the Executive Board. "Our operating result turned out 14% higher at EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 1.282 billion and our net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight were up by 10% to EUR 10.293 billion: healthy numbers and another year of consistent growth. I am pleased to report that organic net profit growth turned out at 10%, despite higher pension charges, the adverse effect on the beer market of the poor weather in large parts of Europe and the lower on-trade sales. The major drivers of our increasing profitability were the worldwide growth of the Heineken brand and our better financial performance in the United States and Poland. New brewery A brewery can be a building or place that produces beer, or a business (brewing company) whose trade is the production and sale of beer. Breweries can take up multiple city blocks, or be a collection of equipment in a homebrewer's kitchen. acquisitions also contributed to Heineken's positive result in 2002." Prospects for 2003: Despite uncertainties, another year of rising profits. Sustained growth in net turnover Net turnover in 2002 was 10% higher at EUR 10,293 million, of which first-time consolidations accounted for 5%. Organic growth in net turnover amounted to 6%, of which higher selling prices and an improved sales mix sales mix See product mix. accounted for 4% and volume growth for 2%. The net negative effect of exchange rate movements on net sales amounted to 1%. There were several material changes in the scope of the consolidation in 2002. The 49.9% interest in BrauHolding International in Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). , which was carried at net asset value in 2002, was proportionally pro·por·tion·al adj. 1. Forming a relationship with other parts or quantities; being in proportion. 2. Properly related in size, degree, or other measurable characteristics; corresponding: consolidated with effect from 1 January January: see month. 2002. Bravo BRAVO Cardiology A clinical trial–Blockade of the GP IIB/IIIA Receptor to Avoid Vascular Occlusion– which evaluated lotrafiban in preventing strokes and acute MI. See GP IIB/IIIA. International in Russia Russia, officially the Russian Federation, Rus. Rossiya, republic (2005 est. pop. 143,420,000), 6,591,100 sq mi (17,070,949 sq km). was fully consolidated with effect from 1 January 2002. Al Ahram Ahram may refer to:
Lebanon (lĕb`ənən, –nŏn'), officially Republic of Lebanon, republic (2005 est. pop. 3,826,000), 4,015 sq mi (10,400 sq km), SW Asia. and Baru This article is about the mekosuchine crocodylian. For other uses, see Baru (disambiguation). Baru was an extinct genus of Australian mekosuchine crocodylian. It was semi-aquatic, around 4 m (13 ft) in length. in Panama Panama, country, Central America Panama (păn`əmä'), Span. Panamá, officially Republic of Panama, republic (2005 est. pop. were consolidated as from 1 October October: see month. . Further, in a few cases, existing interests were extended, and a number of beverage wholesalers were consolidated for the first time. As of 2002, part of the costs of temporary point-of-sale point of sale n. pl. points of sale A business or place where a product or service can be purchased. Also called point of purchase. point activities were reclassified as marketing and selling expenses. In the past these costs were deducted de·duct v. de·duct·ed, de·duct·ing, de·ducts v.tr. 1. To take away (a quantity) from another; subtract. 2. To derive by deduction; deduce. v.intr. from net turnover. To facilitate comparison, both net turnover and marketing and selling expenses for 2001 were increased by EUR 170 million. The reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. has no impact on the results. Heineken advances its position in the world beer market In 2002, the world beer market grew by over 2% to approximately 1.4 billion hl. European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. beer sales were up by 3%, due mainly to growth in Poland and Russia. The US and African beer markets reported modest growth and sales in Asia were also higher, driven by rising demand in China. Group volume*) rose by almost 4 million hl to 84.8 million hl, an increase of 4.8%. Total beer volume of the Group (Group volume plus beer sales by affiliated companies) increased to 108.9 million hl from 105.1 million hl. Heineken beer the driving force behind improved sales mix Sales of Heineken beer in countries where the brand is positioned in the premium segment were 4.5% higher in 2002, with the fastest growth being reported in the United States, Poland and Thailand. This week, Heineken will be introduced in the premium segment in the United Kingdom, and in anticipation of this, sales volume was negatively effected there in 2002, which restricted the growth of worldwide Heineken beer sales to 22.9 million hl (+2.5%). Higher sales of Amstel in Africa and Amstel Light in the United States compensated for reduced volumes in Europe, resulting in Amstel sales remaining stable at 10.8 million hl. Sales of the international specialties of Heineken, mainly Desperados Desperados is the plural form of desperado. It may refer to:
Regional review In Europe, total Heineken Group sales Group sales Block sale (of large amounts) of securities to institutional investors. group sales The distribution of a new security issue to institutional clients. were 2.5 million hl higher at 57.9 million hl in 2002. The individual beer markets showed a varying picture. -- Heineken Nederland reported lower sales, in line with the market, but an improved sales mix and strict cost control contributed to maintaining a stable result. -- With Heineken's share of the shrinking French market holding firm, a better sales mix translated into an improved result. -- The 2002 result in Spain was lower. This was caused by decreased sales, due to customers increasing their stock levels in December 2001 ahead of higher excise duties in 2002 and poor weather in the south of the country, where we have a relatively strong presence. In the second half of the year the situation improved. Profit increased and market share stabilised. -- In Italy, both market share and result improved, thanks to higher sales of Heineken and Birra Moretti, which improved the sales mix, and efficiency gains at the distribution level. -- Sales in Greece held steady and strict cost controls helped to achieve an improved result. -- With sales up 11%, Zywiec Group in Poland grew faster than the market and, thanks to its higher market share and better sales mix, posted a greatly improved result. Sales of the Heineken brand increased threefold. In the United States, sales of Heineken beer were up by 10% and Amstel Light sales increased by 17%. Sales in the Asia/Pacific region were higher, but profits were under pressure from intense competition, especially in China, and the uncertain political situation in Indonesia Indonesia (ĭn'dənē`zhə), officially Republic of Indonesia, republic (2005 est. pop. 241,974,000), c.735,000 sq mi (1,903,650 sq km), SE Asia, in the Malay Archipelago. . In Africa, both sales and operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. rose Nigerian Breweries Nigerian Breweries is a Nigerian brewery, established in 1946, with six breweries throughout the country. It is partially owned by Heineken, the Dutch brewer. Alcoholic Brands
Solid improvement in operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: Operating profit rose by 14% to EUR1,282 million in 2002. The main contributory con·trib·u·to·ry adj. 1. Of, relating to, or involving contribution. 2. Helping to bring about a result. 3. Subject to an impost or levy. n. pl. factors were the growth in sales volume, the improved sales mix and higher prices. The newly consolidated companies also made a positive contribution. Exchange-rate movements had a minor positive effect. Operating profit as a percentage of net turnover increased to 12.5%, compared with 12.1% in 2001 and is now 3.5% above the level of ten years ago. We again invested heavily in strengthening our brands and market positions, which increased marketing and selling costs by 9% to EUR 1,585 million. Marketing and selling costs as a percentage of net turnover stood at 15.4%, compared with 15.5% in 2001. Other operating costs operating costs npl → gastos mpl operacionales were higher, rising 10% to EUR 7,426 million. Raw material, packaging and energy costs were also slightly higher. The increase in staff costs relates mainly to first-time consolidations and additional pension charges. A total of EUR 70 million in additional pension charges worldwide was borne in 2002. This includes the whole of the provision of EUR 65 million for pensions in the Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. , which Heineken had previously announced would be charged to the profit and loss account over five years. Half of this additional pension charge could, however, be set off by using existing provisions for staff costs. Net interest charges increased by EUR 38 million to EUR 109 million, mainly as a result of the financing of new acquisitions and expansion projects at our existing breweries See for an up to date listing of all the breweries detailed on Wikipedia, sorted into regions. Africa
Asia
The tax burden remained stable at 31.0%. Net profit on ordinary activities increased by 11.2% to EUR 795 million in 2002. Earnings per share and dividend proposal Net profit per share on ordinary activities rose from EUR 1.82 to EUR 2.03. Net profit per share on ordinary activities before amortisation Noun 1. amortisation - the reduction of the value of an asset by prorating its cost over a period of years amortization reduction, step-down, diminution, decrease - the act of decreasing or reducing something 2. of intangible fixed assets fixed assets npl → activo sg fijo fixed assets npl → immobilisations fpl fixed assets fix npl → (cash earnings per share) was 11.5% higher, rising from EUR 1.83 in 2001 to EUR 2.05 in 2002. The Annual General Meeting of Shareholders to be held on 24 April 2003 will be invited to declare an unchanged cash dividend of EUR 0.40 per share of EUR 2.00 nominal value Nominal Value The stated value of an issued security that remains fixed, as opposed to its market value, which fluctuates. Notes: When referring to fixed-income securities, the nominal value is also the face value. , from which Dutch withholding tax The amount legally deducted from an employee's wages or salary by the employer, who uses it to prepay the charges imposed by the government on the employee's yearly earnings. at 25% will be deducted. An interim dividend of EUR 0.16 per share was paid on 23 September September: see month. 2002, leaving a final dividend of EUR 0.24 per share. If the meeting approves the dividend proposal, Heineken shares will be quoted ex-dividend Ex-Dividend The trading of shares when a declared dividend belongs to the seller rather than the buyer. Notes: A stock trades ex-dividend on or after the ex-dividend date (ex-date). as from 28 April 2003. The final dividend will be payable on 7 May 2003. Balance sheet and cash flow Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. as at 31 December December: see month. 2002 amounted to EUR 2,543 million compared with EUR 2,758 million at the end of 2001. The movement was the net effect of adding the net profit of EUR 795 million and revaluations of EUR 32 million and deducting goodwill in respect of acquisitions of EUR 778 million, exchange differences of EUR 107 million and a proposed dividend payout pay·out n. 1. The act or an instance of paying out. 2. A percentage of corporate earnings that is paid as dividends to shareholders. of EUR 157 million. Interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid debt increased by EUR 842 million to EUR 2,169 million and the cash position decreased by EUR 397 million to EUR 778 million. Net debt increased from EUR 152 million in 2001 to EUR 1,391 million in 2002, mostly due to the financing of acquisitions. Net investments for acquisitions amounted to EUR 1,222 million and investments in tangible and intangible fixed assets amounted to EUR 731 million. Investments in tangible fixed assets in 2003 are expected to amount to EUR 750 million. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses increased by EUR 19 million to EUR 1,184 million. The increase was due largely to the higher operating profit, which was partially offset by higher working capital. Prospects for 2003: Despite uncertainties, another year of rising profits Our results are affected from year to year by factors which are difficult to predict such as exchange rates, government policy and the weather. Further in 2003 higher pension charges, the cost of launching Heineken beer in the premium segment in the United Kingdom, the effects of the weaker dollar, the deteriorating de·te·ri·o·rate v. de·te·ri·o·rat·ed, de·te·ri·o·rat·ing, de·te·ri·o·rates v.tr. To diminish or impair in quality, character, or value: economic situation in many countries, will also play a role. The newly acquired breweries will deliver a positive contribution. Despite these uncertainties, Heineken expects further growth in net profit in 2003. The possible impact on our results of increasing international tensions can't be predicted. We will also realise a non recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. after tax gain of EUR 73 million in 2003 on the sale of our 15% stake in Argentinian brewer Quilmes. We remain positive regarding the longer-term profit outlook, given the success of our corporate strategy, the strength of our brands, our international coverage, the current debt capacity at our disposal and our extensive international experience. The annual report will be available from 27 March 2003. The analysts' presentation will be shown live on 26 February 2003 at 12:30 on www.heinekeninternational.com. Heineken N.V. and Heineken Holding N.V. shares are listed on the Amsterdam stock exchange
The Amsterdam Stock Exchange is the former name for the stock exchange based in Amsterdam. . Prices for the ordinary shares may be accessed on Bloomberg Bloomberg A major global provider of 24-hour financial news and information including real-time and historic price data, financials data, trading news and analyst coverage, as well as general news and sports. under the symbols HEIA NA and HEHN NA and on the Reuter Equities 2000 Service under HEIA.AS and HEHN.AS. Additional information is available on Heineken's home page: http://www.heinekencorp.com. *) Group volume = beer sales by consolidated companies + sales of Heineken beers brewed and sold under licence by third parties. *) Group volume = sales by consolidated companies + sales of Heineken beers brewed and sold under licence by third parties.
HEINEKEN N.V.
Consolidated Balance Sheet
after proposed appropriation of profit
in millions of euros
31 31
December December
2002 2001
----------- -----------
Assets
------
Fixed assets
Intangible fixed assets 39 13
Tangible fixed assets 4,094 3,592
Financial fixed assets 835 531
----------- -----------
4,968 4,136
Current assets
Stocks 765 692
Receivables 1,270 1,192
Securities 98 29
Cash 680 1,146
----------- -----------
2,813 3,059
----------- -----------
7,781 7,195
=========== ===========
Equity and liabilities
----------------------
Group equity
Shareholders' equity 2,543 2,758
Minority interests 393 381
----------- -----------
2,936 3,139
Provisions 981 1,024
Liabilities
Long-term borrowings 1,215 797
Current liabilities 2,649 2,235
----------- -----------
3,864 3,032
----------- -----------
7,781 7,195
=========== ===========
HEINEKEN N.V.
Consolidated Profit and Loss Account
in millions of euros
2002 2001
----------------------- -----------------------
Net turnover 10,293 9,333*)
Raw materials,
consumables and
services 5,558 5,089*)
Excise duties 1,282 1,226
Staff costs 1,642 1,417
Amortisation/
depreciation and value
adjustments 529 476
----------- -----------
Total operating
expenses 9,011 8,208
----------- -----------
Operating profit 1,282 1,125
Results of non-
consolidated
participating
interests 48 45
Interest -109 -71
----------- -----------
Profit before tax 1,221 1,099
Taxation -364 -327
----------- -----------
Group profit after tax 857 772
Minority interests -62 -57
----------- -----------
Net profit on ordinary
activities 795 715
Extraordinary result
after tax - 52
----------- -----------
Net profit 795 767
=========== ===========
Raw materials, consumables and
services 2002 2001
------------ -----------
Raw materials 525 507
Packaging 949 873
Goods for resale 1,080 978
Marketing and selling expenses 1,585 1,451*
Transport costs 402 357
Energy and water 147 138
Repair and maintenance 185 161
Other expenses 685 624
------------ -----------
5,558 5,089
============ ===========
*Restated for comparison purposes
HEINEKEN N.V.
Regional Segmentation
in millions of euros
2002 2001
----------- -----------
Sales proceeds
Europe (including exports) 8,764 7,951*
Western Hemisphere 1,372 1,176
Africa/Middle East 795 747
Asia/Pacific 471 465
Eliminations -1,276 -1,127
----------- -----------
Total sales proceeds 10,126 9,212
Proceeds from services 167 121
----------- -----------
Net turnover 10,293 9,333*
Operating profit
Europe (including exports) 996 881
Western Hemisphere 70 55
Africa/Middle East 169 129
Asia/Pacific 47 60
----------- -----------
Total 1,282 1,125
Total assets
Europe (including exports) 5,316 4,779
Western Hemisphere 659 395
Africa/Middle East 1,052 791
Asia/Pacific 379 417
----------- -----------
7,406 6,382
Invested cash 375 813
----------- -----------
Total assets according to balance sheet 7,781 7,195
=========== ===========
*Restated for comparison purposes
HEINEKEN N.V.
Consolidated Cash Flow Statement
in millions of euros
2002 2001
----------- -----------
Cash flow from operating activities
-----------------------------------------------
Operating profit 1,282 1,125
Results of non-consolidated participating
interests 48 45
Amortisation/depreciation and value adjustments 529 476
Movements in provisions -8 -32
Movements in working capital -223 -42
----------- -----------
Cash flow from operations 1,628 1,572
Interest paid and received -103 -74
Taxation paid on profits -341 -333
----------- -----------
Cash flow from operating activities 1,184 1,165
Dividends paid -187 -168
----------- -----------
Cash flow from operating activities less
dividends paid 997 997
Cash flow from investing activities
-----------------------------------------------
Intangible fixed assets -35 -17
Tangible fixed assets -696 -578
Consolidated participating interests -799 -148
Non-consolidated participating interests -423 -74
Extraordinary result on sale of participating
interest - 52
Other financial fixed assets -20 -18
----------- -----------
-1,973 -783
Cash flow from financing activities
-----------------------------------------------
Long-term borrowings 484 86
Repayment of long-term borrowings -56 -182
Share issue by group companies -1 57
----------- -----------
427 -39
Net cash flow -549 175
=========== ===========
Other cash movements:
Changes in the consolidation -88 99
Exchange rate movements -36 -14
----------- -----------
Movement in cash -673 260
=========== ===========
The net cash position is made up of:
- Cash 680 1,146
- Securities 98 29
- Bank overdrafts -573 -297
----------- -----------
Position as at 31 December 205 878
=========== ===========
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