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Heineken N.V. Earnings Release 2013

Aug 6, 2013

3848_iss_2013-08-06_48cbc1b9-9dca-45e5-95e2-610595c4e81d.pdf

Earnings Release

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HEINEKEN introduces new disclosure in earnings release

Amsterdam, 6 August 2013 – Heineken N.V. ('HEINEKEN') announced today the introduction of new reporting metrics (non-IFRS) to provide greater transparency on Group performance. This new information will be disclosed for the first time in HEINEKEN's release on the first half of 2013 to be announced on 21 August 2013.

The key new metrics being introduced are:

    1. New volume and financial Group metrics to provide better insight into the contribution of HEINEKEN's joint venture and associate businesses to overall group performance. Group figures are calculated as the sum of all consolidated operations and HEINEKEN's attributable share in joint ventures and associates. New Group figures will be reported for total volume, beer volume, revenue and operating profit (beia). Consequently, the previously reported Group beer volume metric (defined as consolidated beer volume plus 100% of the beer volume sold by joint venture companies) will no longer be reported.
    1. An analysis of total growth split by consolidation impact, currency translation and organic growth at consolidated level.
    1. A breakdown of total volume into the following categories: beer, licensed & non-beer and third party products volume.

To help the market understand how these changes will impact on HEINEKEN's 2013 results, Appendix 1 provides an analysis of 2012 results under the new reporting metrics. The 2012 financial information presented in Appendix 1 has been restated for the implementation of the previously announced revised accounting standard IAS19, which is treated as an inorganic item. Appendix 2 includes a glossary of all relevant reporting metrics.

Press enquiries Investor and analyst enquiries John Clarke George Toulantas E-mail: [email protected] E-mail: [email protected] Tel: +31-20-5239-355 Tel: +31-20-5239-590

John-Paul Schuirink Aarti Narain E-mail: [email protected] E-mail: [email protected] Tel: +31-20-5239-355 Tel. +31-20-5239-590

Editorial information:

HEINEKEN is a proud, independent global brewer committed to surprise and excite consumers with its brands and products everywhere. The brand that bears the founder's family name – Heineken® - is available in almost every country on the globe and is the world's most valuable international premium beer brand. The Company's aim is to be a leading brewer in each of the markets in which it operates and to have the world's most valuable brand portfolio. HEINEKEN wants to win in all markets with Heineken® and with a full brand portfolio in markets of choice. The Company is present in over 70 countries and operates more than 165 breweries. HEINEKEN is Europe's largest brewer and the world's third largest by volume. HEINEKEN is committed to the responsible marketing and consumption of its more than 250 international premium, regional, local and specialty beers and ciders. These include Heineken®, Amstel, Anchor, Biere Larue, Bintang, Birra Moretti, Cruzcampo, Desperados, Dos Equis, Foster's, Newcastle Brown Ale, Ochota, Primus, Sagres, Sol, Star, Strongbow, Tecate, Tiger and Zywiec. Our leading joint venture brands include Cristal and Kingfisher. The number of people employed is over 85,000. Heineken N.V. and Heineken Holding N.V. shares are listed on the NYSE Euronext in Amsterdam. Prices for the ordinary shares may be accessed on Bloomberg under the symbols HEIA NA and HEIO NA and on the Reuter Equities 2000 Service under HEIN.AS and HEIO.AS. HEINEKEN has two sponsored level 1 American Depositary Receipt (ADR) programmes: Heineken N.V. (OTC: HEINY) and Heineken Holding N.V. (OTC: HKHHY). Most recent information is available on HEINEKEN's website: www.theHEINEKENcompany.com.

Appendix 1

Consolidated (A) Attributable share of
joint ventures / assoc (B)
Group* (C) = A + B
(in mhl or €million unless otherwise
stated)
FY11 Currency
Translation
Consolidation
impact
Organic
Growth
FY12 Organic
Growth
%
FY11 FY12 FY11 FY12 Organic
Growth %
Africa Middle East
Revenue 2.223 115 26 275 2.639 12 490 548 2.713 3.187
Operating profit (beia) 534 21 8 55 618 10 55 48 589 666
Operating profit (beia) margin 24.0% 23.4% -43bps 11.1% 8.7% 21.7% 20.8%
Total volume 28.5 0.5 1.3 30.3 5 4.8 5.1 33.3 35.4 5
Beer volume 22.0 0.5 0.8 23.3 4 3.3 3.5 25.3 26.8 4
Licensed & non-beer volume 6.4 - 0.5 6.9 8 1.3 1.4 7.7 8.3 8
Third party products volume 0.1 - - 0.1 6 0.2 0.2 0.3 0.3 -11
Americas
Revenue 4.029 76 89 329 4.523 8 600 726 4.629 5.249
Operating profit (beia) 577 16 31 54 678 9 123 126 700 804
Operating profit (beia) margin 14.3% 15.0% +14bps 20.5% 17.4% 15.1% 15.3%
Total volume 50.8 1.4 2.1 54.3 4 6.6 6.7 57.4 61.0 4
Beer volume 50.5 0.5 2.1 53.1 4 3.8 3.8 54.3 56.9 4
Licensed & non-beer volume 0.2 0.9 - 1.1 3 2.8 2.9 3.0 4.0 11
Third party products volume 0.1 - - 0.1 12 - - 0.1 0.1 12
Asia Pacific
Revenue 216 17 287 7 527 3 944 967 1.160 1.493
Operating profit (beia) 64 3 88 1 156 2 192 236 257 393
Operating profit (beia) margin 29.9% 29.7% -48bps 20.2% 24.5% 22.1% 26.3%
Total volume 1.3 2.9 - 4.2 2 13.7 13.2 15.0 17.4 5
Beer volume 1.3 2.4 - 3.7 2 13.7 13.2 15.0 16.9 5
Licensed & non-beer volume - 0.4 - 0.5 19 - - - 0.5 1
Third party products volume - - - - - - - - - -
Central & Eastern Europe
Revenue 3.229 -74 - 125 3.280 4 381 360 3.610 3.640
Operating profit (beia) 331 -3 8 -3 333 -1 24 30 355 363
Operating profit (beia) margin 10.3% 10.1% -47bps 6.3% 8.3% 9.8% 10.0%
Total volume 48.3 - 1.6 49.9 3 5.2 4.9 53.5 54.8 3
Beer volume 45.4 - 1.9 47.3 4 3.6 3.7 49.0 51.0 4
Licensed & non-beer volume 1.4 - -0.1 1.3 -8 0.6 0.6 2.0 1.9 -6
Third party products volume 1.5 - -0.2 1.3 -10 1.0 0.5 2.5 1.9 -6

*Group financial reporting metrics are non-IFRS and unaudited

Consolidated (A) Attributable share of
joint ventures / assoc (B)
Group* (C) = A + B
(in mhl or €million unless otherwise
stated)
FY11 Currency
Translation
Consolidation
impact
Organic
Growth
FY12 Organic
Growth
%
FY11 FY12 FY11 FY12 Organic
Growth %
Western Europe
Revenue 7.752 112 -70 -9 7.785 - - - 7.752 7.785
Operating profit (beia) 959 10 40 -62 947 -6 - - 959 947
Operating profit (beia) margin 12.4% 12.1% -79bps - - 12.4% 12.1%
Total volume 65.4 - -2.2 63.2 -3 - - 65.4 63.2 -3
Beer volume 45.4 -0.2 -0.9 44.3 -2 - - 45.4 44.3 -2
Licensed & non-beer volume 11.1 0.1 -0.6 10.6 -5 - - 11.1 10.6 -5
Third party products volume 9.0 - -0.7 8.3 -8 - - 9.0 8.3 -8
Head Office & Eliminations
Revenue -326 9 5 -58 -370 -18 - - -326 -370
Operating profit (beia) -9 1 - -57 -65 > 100 - - -9 -65
Heineken N.V.
Revenue 17.123 254 336 670 18.383 4 2.416 2.601 19.539 20.984 5
Total expenses (beia) -14.667 -205 -163 -683 -15.717 -5 -2.022 -2.161 -16.691 -17.878
Operating profit (beia) 2.456 49 174 -13 2.666 -1 395 440 2.851 3.106 1
Operating profit (beia) margin 14.3% 14.5% -61bps 16.3% 16.9% 14.6% 14.8%
Share of net profit of associates / JVs 240 15 -3 - 252 -
Net Interest income/ (expenses) -424 -2 -86 23 -489 5
Other net finance income/(expenses) -20 2 -43 23 -38 115
Income tax expense (beia) -539 -9 -22 1 -569 -
Minority interests -129 -5 -17 -10 -161 -8
Net profit (beia) 1.584 50 1 26 1.661 2 0 0 1.585 1.662
Total volume 194.4 4.7 2.9 202.0 1 30.4 29.8 224.8 231.9 2
Beer volume 164.6 3.2 3.9 171.7 2 24.5 24.2 189.1 195.9 3
Licensed & non-beer volume 19.2 1.4 -0.1 20.5 -1 4.6 4.9 23.8 25.5 1
Third party products volume 10.6 0.1 -0.9 9.8 -8 1.3 0.7 11.9 10.5 -8
2012 H1 2012 H2
(in mhl or €million unless otherwise
stated)
Consolidated Attributable share of
JV / assoc
Group* Consolidated Attributable share of
JV / assoc
Group*
Africa Middle East
Revenue 1.292 241 1.532 1.347 308 1.655
Operating profit (beia) 317 22 339 301 27 328
Operating profit (beia) margin 24.5% 9.1% 22.1% 22.4% 8.8% 19.8%
Total volume 14.8 2.3 17.1 15.5 2.8 18.3
Beer volume 11.6 1.6 13.2 11.7 1.9 13.6
Licensed & non-beer volume 3.2 0.6 3.8 3.8 0.7 4.5
Third party products volume - 0.1 0.1 - 0.1 0.1
Americas
Revenue 2.169 329 2.498 2.353 397 2.751
Operating profit (beia) 301 50 351 376 76 452
Operating profit (beia) margin 13.9% 15.3% 14.1% 16.0% 19.2% 16.4%
Total volume 26.0 3.2 29.2 28.4 3.5 31.9
Beer volume 25.5 1.8 27.3 27.7 2.0 29.7
Licensed & non-beer volume 0.5 1.4 1.9 0.6 1.5 2.1
Third party products volume - - - 0.1 - 0.1
Asia Pacific
Revenue 113 554 667 414 413 826
Operating profit (beia) 31 145 176 125 91 217
Operating profit (beia) margin 27.5% 26.2% 26.4% 30.3% 22.2% 26.2%
Total volume 0.6 7.6 8.2 3.6 5.6 9.2
Beer volume 0.6 7.6 8.2 3.1 5.6 8.7
Licensed & non-beer volume - - - 0.5 - 0.5
Third party products volume - - - - - -
Central Eastern Europe
Revenue 1.587 168 1.755 1.692 192 1.885
Operating profit (beia) 109 10 119 224 19 243
Operating profit (beia) margin 6.9% 6.2% 6.8% 13.2% 10.1% 12.9%
Total volume 24.6 2.3 26.9 25.3 2.5 27.8
Beer volume 23.2 1.8 25.0 24.0 1.9 25.9
Licensed & non-beer volume 0.7 0.3 1.0 0.6 0.3 0.9
Third party products volume 0.7 0.2 0.9 0.7 0.3 1.0
2012 H1 2012 H2
(in mhl or €million unless otherwise
stated)
Consolidated Attributable share of
JV / assoc
Group* Consolidated Attributable share of
JV / assoc
Group*
Western Europe
Revenue 3.815 - 3.815 3.970 - 3.970
Operating profit (beia) 418 - 418 528 - 528
Operating profit (beia) margin 11.0% - 11% 13.3% - 13.3%
Total volume 30.8 - 30.8 32.4 - 32.4
Beer volume 21.6 - 21.6 22.6 - 22.6
Licensed & non-beer volume 5.1 - 5.1 5.5 - 5.5
Third party products volume 4.1 - 4.1 4.2 - 4.2
Head office Eliminations
Revenue -197 - -197 -172 - -172
Operating profit (beia) -27 - -27 -38 - -38
Heineken NV
Revenue 8.778 1.292 10.070 9.604 1.310 10.914
Total expenses (beia) -7.628 -1.064 -8.692 -8.088 -1.097 -9.185
Operating profit (beia) 1.150 228 1.378 1.516 213 1.729
Operating profit (beia) margin 13.1% 17.7% 13.7% 15.8% 16.2% 15.8%
Share of net profit of associates / JVs 118 -6 134 0
Net Interest income/ (expenses) -234 -255
Other net finance income/(expenses) -22 -16
Income tax expense (beia) -262 -52 -308 -47
Minority interests -63 -38 -98 -27
Net profit (beia) 688 118 806 974 124 1099
Total volume 96.9 15.4 112.3 105.2 14.4 119.6
Beer volume 82.6 12.7 95.3 89.1 11.5 100.6
Licensed & non-beer volume 9.4 2.3 11.7 11.0 2.6 13.6
Third party products volume 4.9 0.3 5.2 5.0 0.4 5.4

2012 by Quarter

Quarter 1 Quarter 2 Quarter 3 Quarter 4
(in mhl or €million unless
otherwise
stated)
Consolidated Attributable
share of joint
ventures
/ assoc
Group* Consolidated Attributable
share of joint
ventures
/ assoc
Group* Consolidated Attributable
share of joint
ventures
/ assoc
Group* Consolidated Attributable
share of joint
ventures
/ assoc
Group*
Africa Middle East
Revenue 622 119 741 669 122 791 645 150 795 703 158 860
Total volume 7.2 1.1 8.3 7.6 1.2 8.8 7.5 1.3 8.8 8.0 1.5 9.5
Beer volume 5.7 0.7 6.4 5.9 0.8 6.7 5.5 0.8 6.3 6.2 1.1 7.3
Licensed & non-beer volume 1.5 0.3 1.8 1.7 0.3 2.0 2.0 0.4 2.4 1.8 0.4 2.2
Third party products volume - -
0.1
- - 0.1 - 0.1 0.1 - - -
Americas
Revenue 983 181 1.164 1.186 148 1.334 1.201 174 1.375 1.152 223 1.375
Total volume 11.8 1.9 13.7 14.2 1.3 15.5 13.9 1.5 15.4 14.4 2.0 16.4
Beer volume 11.7 1.1 12.8 13.7 0.7 14.4 13.6 0.8 14.4 14.1 1.2 15.3
Licensed & non-beer volume 0.1 0.8 0.9 0.5 0.6 1.1 0.3 0.7 1.0 0.3 0.8 1.1
Third party products volume - - - - - - - - - - - -
Asia Pacific
Revenue 48 282 330 65 272 337 78 248 326 336 165 501
Total volume 0.3 3.9 4.2 0.4 3.7 4.1 0.4 3.4 3.8 3.1 2.2 5.3
Beer volume 0.3 3.9 4.2 0.4 3.7 4.1 0.4 3.4 3.8 2.7 2.2 4.9
Licensed & non-beer volume - - - - - - - - - 0.4 - 0.4
Third party products volume - - - - - - - - - - - -
Quarter 1 Quarter 2 Quarter 3 Quarter 4
(in mhl or €million unless
otherwise
stated)
Consolidated Attributable
share of joint
ventures
/ assoc
Group* Consolidated Attributable
share of joint
ventures
/ assoc
Group* Consolidated Attributable
share of joint
ventures
/ assoc
Group* Consolidated Attributable
share of joint
ventures
/ assoc
Group*
Central & Eastern Europe
Revenue 621 70 691 966 98 1.064 980 112 1.092 712 80 792
Total volume 9.6 1.0 10.6 15.0 1.4 16.4 15.0 1.5 16.5 10.3 1.0 11.3
Beer volume 9.1 0.7 9.8 14.2 1.1 15.3 14.2 1.2 15.4 9.8 0.8 10.6
Licensed & non-beer volume 0.2 0.2 0.4 0.4 0.2 0.6 0.4 0.2 0.6 0.3 0.1 0.4
Third party products volume 0.3 0.1 0.4 0.4 0.1 0.5 0.4 0.1 0.5 0.3 0.1 0.4
Western Europe
Revenue 1.642 - 1.642 2.173 - 2.173 2.166 - 2.166 1.804 - 1.804
Total volume 13.1 -
13.1
17.7 - 17.7 17.8 - 17.8 14.6 - 14.6
Beer volume 9.1 - 9.1 12.5 - 12.5 12.4 - 12.4 10.2 - 10.2
Licensed & non-beer volume 2.2 - 2.2 2.9 - 2.9 3.0 - 3.0 2.5 - 2.5
Third party products volume 1.8 - 1.8 2.3 - 2.3 2.4 - 2.4 1.8 - 1.8
Head office & Eliminations
Revenue -82 - -82 -116 - -116 -96 - -96 -76 - -76
Heineken N.V.
Revenue 3.834 652 4.487 4.944 640 5.584 4.974 684 5.658 4.630 626 5.256
Total volume 42.0 7.8 49.8 54.9 7.6 62.5 54.7 7.7 62.4 50.4 6.8 57.2
Beer volume 35.9 6.4 42.3 46.7 6.3 53.0 46.2 6.2 52.4 43.0 5.3 48.3
Licensed & non-beer volume 3.9 1.2 5.1 5.5 1.1 6.6 5.7 1.3 7.0 5.3 1.3 6.6
Third party products volume 2.2 0.2 2.4 2.7 0.2 2.9 2.8 0.2 3.0 2.2 0.2 2.4

Appendix 2

GLOSSARY

Beia

Before exceptional items and amortisation of acquisition related intangible assets

Operating profit

Consolidated operating profit Results from operating activities

Group Operating profit (beia) Consolidated operating profit (beia) plus attributable share of operating profit (beia) from joint ventures and associates

Organic growth

Growth excluding the effect of foreign currency translational effects, consolidation changes, exceptional items, amortisation of acquisition-related intangible assets

Organic volume growth

Growth in volume, excluding the effect of consolidation changes

Revenue

Consolidated revenue Net realised sales proceeds

Group revenue (beia)

Consolidated revenue plus attributable share of revenue from joint ventures and associates

Volume

Consolidated beer volume

100 per cent of beer volume produced and sold by consolidated companies

Group beer volume

Consolidated beer volume plus attributable share of beer volume from joint ventures and associates

Group total volume

Total consolidated volume plus attributable share of volume from joint ventures and associates

Heineken® volume

100 per cent of beer volume sold of the Heineken® brand by consolidated companies, joint ventures and associates and produced and sold under license by third parties

Heineken® volume in premium segment

100 per cent of beer volume sold of the Heineken® brand in the premium segment (Heineken® volume in the Netherlands is excluded) by consolidated companies, joint ventures and associates and produced and sold under licence by third parties

Licensed & non-beer volume

Cider, soft drink and non-beer volume sold in consolidated companies, joint ventures and associates, as well as HEINEKEN's brands produced and sold under licence by third parties

Third party products volume

Volume of third party products sold through consolidated companies, joint ventures and associates

Total Consolidated volume

100 per cent of volume produced and sold by consolidated companies (including beer, cider, soft drinks and other beverages), volume of third party products and volume of HEINEKEN's brands produced and sold under licence by third parties