Heineken gets stronger after S&N integration

Heineken announced its results for the 6 months to 30th June and said that the integration of S&N is now complete.

Its joint acquisition of S&N, in partnership with Carlsberg, helped Heineken’s beer volumes to rise 3.8% in the period. It achieved pre-tax profits of £729 million in the 6 months to 30th June, as compared to £639 million for the same period a year earlier. The integration of S&N also helped Heineken to achieve cost synergies of £145 million. Sadly, though, the changes entail the loss of 750 jobs by the first quarter of 2010. The company also warned that general unemployment would be likely to impact upon its year-on-year sales. Heineken is pursuing a policy of sound pricing and cost reductions. Heineken and Carlsberg bought S&N for £7.8bn. Heineken’s UK portfolio now includes Foster’s, John Smith’s and Kronenbourg 1664.

Meanwhile, Heineken’s fellow brewing giant, Diageo, has been experiencing a mixed time of late. The spirits and Guinness producer reported pre-tax profits down by nearly 4% at £2.02bn. It did, however, achieve operating profits up 13% at £2.6bn. Diageo said that the impact on its business of the economic environment has been varied. North America and Asia Pacific have been stronger than Europe.

Diageo is facing continuing protests over job losses. The Save the Johnnie Walker in Kilmarnock Campaign timed its visit to the company’s London headquarters to coincide with the announcement of Diageo’s results, which were for the year to the end of June 2009.

27 August 2009