Heineken Nv · EURONEXT:HEIA
Heineken Nv — FY2023 Earnings Presentation
25 slides from Heineken Nv's earnings presentation, Feb 14, 2024
Slide 1: Heineken N.V. 2023 Full Year Results
Heineken N.V. 2023 Full Year Results Dolf van den Brink, CEO Harold van den Broek, CFO
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements based on current expectations and assumptions with regards to the financial position and results of HEINEKEN’s activities, anticipated developments and other factors. All statements other than statements of historical facts are, or may
Slide 3: Significant progress on EverGreen, despite a challenging external environment
Significant progress on EverGreen, despite a challenging external environment Strategic Priorities Growth Algorithm Green Diamond Growth ① SHAPE THE FUTURE OF BEER & BEYOND Capital Profitability ② DIGITAL efficiency ③ PRODUCTIVITY Sustainability & ④ SUSTAINABILITY Responsibility ⑤ PEOPLE What we foc
Slide 4: FY 2023 financial highlights
FY 2023 financial highlights +5.5% +10.8% Net revenue (beia) OG Net revenue (beia) OG per hl -4.7% +3.4% Total beer volume OG Heineken volume® (exc Russia) OG +1.7% +14.7% Operating profit (beia) OG -100bps Operating profit (beia) margin -4.3% 4.67 Net profit (beia) OG Diluted EPS (beia) EUR OG: Org
Slide 5: Majority of markets returning to growth in Q4
Majority of markets returning to growth in Q4 Beer volume OG% vs LY Premium Beer (Excl. Vietnam and Nigeria) 0% Beer (Excl. Vietnam and Nigeria) Beer Q1 Q2 Q3 Q4 % of markets in growth >40% >25% >35% >50% (Beer volume OG% vs LY) % of markets holding or c.60% >50% >50% c.55% gaining market share OG:
Slide 6: Africa & Middle East
Africa & Middle East Nigeria. Revenue growth from pricing for inflation. Consumers purchasing power affected by structural reforms. +11.6% +17.4% Right-sized our cost base to adapt to Net revenue (beia) OG Price mix1 challenging environment. Ethiopia. Growth momentum significantly ahead of the marke
Slide 7: Americas
Americas Mexico. Outperforming the market in the last year of OXXO mixing. Six stores now 17k. New greenfield in +7.4% +8.4% Yucatán. Net revenue (beia) OG Price mix1 USA. Sales-to-retailers outperformed the market. Heineken® Silver launch promising. Heineken® 0.0 grew in the low-teens. -0.1% +6.2%
Slide 8: Winning in Premium and Pure Malt Mainstream in Brazil
Winning in Premium and Pure Malt Mainstream in Brazil Heineken® and Amstel Brazil Volume Evolution, 2013-23 (mHL) #1 #1 Off trade brand Pure Malt by value1 +31% +68% Mainstream1 CAGR CAGR ’15-’23 ’15-’23 Brand #1 Power brand power2 > Share #1 >10m brand by Volume, hl penetration3 2015 2023 2015 2023
Slide 9: Asia Pacific
Asia Pacific Vietnam. Market continues to be impacted by external factors. Mainstream portfolio outperformed -5.9% +4.0% the market with Bia Viet, Bivinia and Net Revenue (beia) OG Price Mix1 La Rue gaining share. India. Improved in the second half and outperformed the market. -10.4% -20.0% Kingfish
Slide 10: A strong growth partnership in China
A strong growth partnership in China Now our second largest Heineken® market globally Volume growth momentum Generating meaningful contribution Significant distribution headroom Heineken® volume, khl Contribution to EPS (beia) Points of sale 4.5x c.5m c.1m c.0.04m 2019 2020 2021 2022 2023 2019 2020
Slide 11: Europe
Europe Volume performance improved to a 3.4% decline in Q4. The volume perfomrance in the On +6.3% +11.7% Trade was better than in the Off Net revenue (beia) OG Price mix1 Trade. Premium beer volume outperformed, led by our next -5.4% +11.9% generation brands. Beer volume OG Operating profit (beia)
Slide 12: Heineken continues outperformance
Heineken continues outperformance ® Volume growth Heineken® 0.0 150 years of Heineken® +3.4% +5.7% (excl. Russia) (excl. Russia) Most Awarded Food & Drink Brand Cannes 2023 Heineken® Silver 39 markets +38% New 0.0 Contributing to growth Now present in 50 markets ambassador Max Verstappen 12
Slide 13: Becoming the best-connected brewer
Becoming the best-connected brewer 10.7bn GMV Building scale digital Capturing value through 700k active customers platforms AI driven products Gross Merchandise Value (GMV) €bn +c2-3% 3X Sales Uplift1 10.7 Improved Product recommendations 56% 83% +50% 3.5 Sales force productivity 40% 63% Customer c
Slide 14: Building momentum on Brew a Better World
Building momentum on Brew a Better World Environmental Social Responsible 34% 28% 14% absolute carbon reduction in women in senior media spend Heineken® production* vs 2018 leadership responsibility campaigns, (2022: 18%) *scope 1&2 (2022 27%) reaching 0.9b consumers (2022: >10% / 1.2) 28 100% 53% b
Slide 15: Financial Highlights
Financial Highlights 15
Slide 16: Our EverGreen growth algorithm
Our EverGreen growth algorithm Strengths & Long-term value opportunities Sustainability creation Responsibility People 16
Slide 17: Price-led topline growth
Price-led topline growth Net Revenue (beia): +5.5% organic increase Net Revenue (beia) €m Organic increase €1.591m -1,350 2,941 -4.7% -864 887 Volume OG Of which: +10.2% Price-Mix1 OG VN & Nig: -2.3% All others: -2.4% Of which: Price: +9.1% 30,308 Mix: +1.1% 28,694 FY 2022 Price-Mix Total Volume Cur
Slide 18: Operating profit (beia) returning to growth
Operating profit (beia) returning to growth Operating Profit (beia): +1.7% organic increase Operating Profit (beia) €m 78 -102 -35 Of which: Vietnam: -32% All others: +7.6% 4,502 4,443 FY 2022 Organic growth Currency translation Consolidation impact FY 2023 18
Slide 19: Productivity embedded in the organisation
Productivity embedded in the organisation €800m delivered in ’23 Via diversified initiatives Towards continuous productivity Procurement savings Incl. Brazil local sourcing +0.8bn >€240m €0.5bn €0.4bn €0.4bn €2.5 B European E2E supply €2 B Target chain transformation €1.7 B €1.3 B >€200m Design for
Slide 20: Other key financial metrics
Other key financial metrics €m unless otherwise stated - Beia FY 2023 FY 2022 vs LY1 Operating Profit 4,443 4,502 +1.7% Share of Profit 270 263 +4.3% Net Interest Income & Expenses -554 -380 -44.8% Other Net Finance Income & Expenses -343 -63 -537.3% Net Profit 2,632 2,836 -4.3% ETR 26.8% 27.7% -90b
Slide 21: FOCF delivery vs 2022
FOCF delivery vs 2022 FOCF €m 334 -46 -583 -355 2,409 1,759 FY 2022 Cash flow from Working capital Capex2 Interest, dividend FY 2023 operations1 & income tax 1. Cash flow from operations before changes in working capital and after provisions and post-retirement obligations 21 2. Cash flow used in op
Slide 22: Other financial items
Other financial items 2023: impairment of 2023/4: currency volatility Heineken Beverages example: Nigeria 2024: Brazil tax reforms Heineken Beverages NAFEX Official rate ETR evolution Enterprise value EUR/NGN 1613 29.0 Other Factors c.70% c.35% devaluation devaluation 27.7 Changes in WACC 907 26.8 8
Slide 23: Outlook 2024
Outlook 2024 EverGreen strategy progressing. Fully committed to return to balanced growth with proportionate investments. Variable costs to increase by a low-single-digit on a per hectoliter basis, and higher than historical average wage inflation. Continuous productivity programme to deliver at lea
Slide 24: Continued focus on delivering EverGreen
Continued focus on delivering EverGreen Strategic Priorities Growth Algorithm Green Diamond Growth ① SHAPE THE FUTURE OF BEER & BEYOND Capital Profitability ② DIGITAL efficiency ③ PRODUCTIVITY Sustainability & ④ SUSTAINABILITY Responsibility ⑤ PEOPLE What we focus on How we create value How we measu
Slide 25: Thank you Q & A
Thank you Q&A 25