Heineken sold more beer in the first quarter than expected, sticking to its forecast profit growth in 2024.
The drinks maker announced the results as it reported its first quarterly year-on-year growth in volumes in a year.
It had previously reported that it expected profits to land significantly below analysts' expectations in Febraury.
The company said on Wednesday that beer volumes rose organically by 4.7% in the January to March period.
This beat the 2.5% growth expected by analysts in a company-provided poll.
Its shares rose as much as 1.6%, pairing some of the gains to trade 0.4% higher by 0805 GMT.
Volume Growth
The world’s second-largest brewer is focused on restoring volume growth this year.
Volume growth was hurt in 2023 as the company hiked prices to offset rising production and ingredient costs.
Chief executive Dolf van den Brink said in a statement that all regions posted higher volume and net revenue.
He added that the first quarter was helped by an earlier Easter and one-off effects.
However, the brewer said it continued to see the economic environment as “challenging and uncertain.”
It added, “Despite the solid start to the year, we cannot extrapolate the reported top-line growth to the rest of the year.”
Heineken disappointed investors in February with its wide range for forecast operating profit growth.
The company said profit growth could be anywhere between a low and high single-digit percentage this year.
‘Turned A Corner’
The cautious view early in the year is partly due to uncertainty in two of its markets – Vietnam and Nigeria – where economic conditions dragged its performance last year.
According to Heineken, total volume in Nigeria grew close to 20%, while in Vietnam volume rose to the low teens.
Laurence Wyatt, an analyst at Barclays, pointed out that recovery in high-margin market Vietnam. He also mentioned a promising performance in Mexico and Brazil.
“There is no denying that the underlying business appears to have turned the corner and we continue to expect improvements during the year,” he said.
Heineken said its namesake brand became the number one brand by value in Brazil in the quarter. Beer volume also grew by a high single digit percentage.
Net revenue before one-offs rose 9.4% organically to €6.85 billion, which landed above the 7.2% growth expected by analysts.
Heineken added that currency translation reduced the figure by 4.6%.
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