Heineken’s profit has soared by almost 250% in the first quarter of 2022, taking its underlying net profit to £347m (€417m), compared to £140m (€168m) in 2021.
Sales were driven by a 24.9% increase in underlying net revenue, as bar and restaurant sales returned in Europe and higher pricing benefited all regions.
Growth was seen across all regions, especially in Europe, where the group lapped a weak comparable period last year due to restrictions.
Despite warning on “significant additional inflationary headwinds”, the outlook for 2022 remains unchanged and the group expects to deliver modest improvements in underlying operating profit margin.
“A 46.1% increase in European beer volume was welcome news and bodes well for the rollout of new products in the region like Heineken Silver which are key growth drivers as part of the group’s new strategy,” Hargreaves Lansdown equity analyst Matt Britzman said.
READ MORE: Heineken to increase beer prices amid inflation
“More broadly, the shift in consumer behaviour to favour more premium beers is a trend Heineken’s well placed to manage with a strong list of premium brands from Moretti to Desperados, not to forget the obvious name.”
Britzman added: “It’s a good job too because cost inflation lingers and raising the price on premium products won’t be met with as much consumer kickback as it would on a value offering.”
“The other benefit is purely from a margin standpoint, premium brands are more profitable and we’re seeing the benefit in the premiumisation shift already with revenue per hectolitre up 18.3%.”
The news comes after Heineken announced plans to cease operations in Russia and transfer ownership of its business.
As a result, there is expected to be a non-cash exceptional charge of around £333 million (€400 million).
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