Heineken to wield axe again as emerging markets take centre stage

Heineken has announced a new round of cost-cutting across its operations in developed markets including continental Europe and the UK.

The Dutch brewer unveiled plans to slash €500m from its operational overheads over the next three years. The cash will be used to fund its expansion in emerging markets.

The move came as Heineken reported better-than-expected results for the past year. Sales were up 3.6% to €17.1bn, driven by volume growth of 2.1% as well as higher prices. Profits were down slightly on last year due to one-off costs but after exceptional items were up 1.4% to €2.7bn.

In the UK, beer volumes were down 2.8% and cider sales down 10%, with Heineken admitting that the launch of Stella Cidre had eaten into sales of its Strognbow brand.

“We have to invest where the growth is,” chief executive Jan van Boxmeer told the Financial Times. “We have shifted the portfolio towards emerging markets.”

Heineken last year completed a decade-long round of closures that saw more than 40 factories shut down across Europe, saving the company an estimated €600m.