Heineken Sees Profit Rise -- Update

By Maarten van Tartwijk 

AMSTERDAM-- Heineken NV said Wednesday that currency shifts helped to boost revenue in the first quarter, making it the latest European multinational to benefit from a weaker euro.

Heineken, the world's third-largest brewer by sales, said the weakening euro against major currencies such as the U.S. dollar led to currency benefits of EUR227 million ($243 million) in the period, helping to push consolidated revenue 7.4% higher to EUR4.34 billion.

Chief Executive Jean-François van Boxmeer said the strong sales figures reflected "the benefits of Heineken's geographic diversity."

Many European consumer-goods companies with big exposures to the U.S. and other non-European markets have welcomed a weaker euro as it leads to a sharp increase in the value of their sales.

Last week, consumer-goods giant Unilever PLC said that its first-quarter sales rose 12%, largely on the back of a stronger dollar and that full-year earnings would swell by 8% to 9% this year at current exchange rates.

Heineken, whose brands include Heineken, Amstel and Sol, not only benefited from a stronger dollar but also saw its sales boosted by the euro's decline against the Mexican peso and Vietnamese dong.

The Amsterdam-based brewer has reduced its reliance on Europe in recent years following a series of acquisitions in emerging markets in Asia and Latin America.

That strategy appeared to pay off in the first quarter. Organic revenue, which strips out currency swings, increased by 2% in the period, driven by higher beer volumes in the Americas and Asia. This helped to offset a sluggish performance in Western and Eastern Europe and subdued growth in Africa, where Heineken mostly blamed economic uncertainties in Nigeria.

Net profit was EUR579 million in the first three months of 2015, lifted by a EUR375 million gain on the sale of Empaque, a Mexican packaging company that was sold in February.

Write to Maarten van Tartwijk at [e-mail]

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