Heineken’s sales are losing their fizz as punters drink less beer in the face of higher prices
Heineken sales have fallen flat as punters put down their favorite pints in the face of higher prices.
The Dutch brewer, which also owns Amstel and Sol, said UK sales fell by nearly 10 percent in the first three months of the year as consumers cut back.
Despite the dip in sales, Heineken said sales were up about 5 percent, with premium drinks such as Birra Moretti and Beavertown leading the way in Britain.
Total beer volume for the group fell 3 percent in the first quarter, worse than the expected 1.9 percent decline.
Price hikes: Heineken said UK sales fell by nearly 10% in the first three months of the year as consumers cut back
Heineken said volumes were depressed by a “disappointing” performance in Asia, Africa and the Middle East, while Europe was “relatively resilient” as consumers invest in more expensive beers when they indulge.
The price of raw materials has skyrocketed, putting pressure on brewers to raise their prices across the board.
The company said it was awaiting approval to sell its business in Russia. It has previously said leaving the region would mean a £245 million hit.
“We see the economic environment as volatile and uncertain,” said Dolf van den Brink, CEO of Heineken.
For this year, Heineken still expects earnings growth in the mid-to-high single digit.
Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said Heineken’s continued price rises “leave a bad taste in consumers’ mouths”.
‘For the time being, price increases were enough to compensate for falling volumes, which inflated sales.
“Unfortunately, the higher revenues have not trickled down to earnings,” he said.