Vietnam underperformance impacts Heineken’s H1 sales

By Tri Duc
Thu, August 3, 2023 | 7:58 am GMT+7

Vietnam contributed significantly to a 5.6% year-on-year fall in Heineken's global sales in the first half of the year, says the leading beer maker.

In its H1 report, Heineken says the economic slowdown in Vietnam, especially in major cities, continued into the second quarter and disproportionally impacted the premium beer segment.

Heineken Silver, a premium beer product in Vietnam. Photo courtesy of Heineken.

Heineken Silver, a premium beer product in Vietnam. Photo courtesy of Heineken.

In particular, Heineken’s net revenue in Vietnam declined by over 20% as the result of a 25% fall in sales volume. The brewer estimates that the total market was down by high single-digits in the second quarter, according to CEO Dolf van den Brink.

Over half of the drop in sales volume was driven by the destocking of Tet (Lunar New Year) overhang, and the distributors’ stock levels getting “normalized” in the second quarter, the CEO added.

Besides, the market’s downtrading, exacerbated by Heineken products’ pricing ahead of the market, particularly Tiger beer, contributed to the brand’s underperformance in the period.

Heineken was addressing the issue to restore consumers’ affordability, he said

Some of Heineken products performed well in the period, like the premium brands of Heineken Silver and Tiger Crystal and mainstream ones of Bia Viet and Bivina, supported by brewer’s expansion to regions beyond its core strengths.

The brewer’s net global revenue increased 12% year-on-year to EUR14.51 billion ($15.94 billion) in H1/2023, as the growth in the underlying price-mix component outweighed the fall in the volume sales.

A 2.8 percentage point decrease within the fall of 5.4% in H1/2023 volume sales “can be attributed to the underperformance in Vietnam and socioeconomic volatility in Nigeria,” said CFO Harold van den Broek.

For H2/2023, Heineken expects significantly improved growth in operating profit, partly thanks to improved outlook in Vietnam and Nigeria.

It said in a recent review that retail beer sales in Vietnam reached EUR11 billion ($12.07 billion) last year, adding that was the market leader in the country. It also said that Vietnam’s beer market volume hit 46 million hectoliters in 2022, up 3.6% over 2021.

Heineken Vietnam said in the report that it supported 246,000 jobs across the value chain, equivalent to 0.49% of Vietnam’s labor force.

Heineken Vietnam’s value chain contributed VND72.7 trillion ($3.07 billion) to the economy, representing 1.04% of the country’s GDP, higher than the 0.94% posted in 2019 in the pre-pandemic era, the report said.

Comments (0)
  • Read More
Construction trio keen on building $1.5 bln expanded expressway in southern Vietnam

Construction trio keen on building $1.5 bln expanded expressway in southern Vietnam

Three construction majors in Vietnam are interested in building an expanded expressway connecting Ho Chi Minh City with the Mekong Delta provinces of Long An and Tien Giang for an estimated VND38.6 trillion ($1.52 billion).

Infrastructure - Tue, November 19, 2024 | 8:18 pm GMT+7

Singapore, Germany upgrade relations to strategic partnership

Singapore, Germany upgrade relations to strategic partnership

Singapore and Germany have decided to elevate their ties to a Strategic Partnership to promote closer cooperation in areas of mutual interest such as security, artificial intelligence (AI) and clean energy.

Southeast Asia - Tue, November 19, 2024 | 8:01 pm GMT+7

Thailand’s rice shipment up 20% in 10 months

Thailand’s rice shipment up 20% in 10 months

Thailand exported 8.37 million tons of rice in January-October, a year-on-year increase of 20%, according to the Ministry of Commerce.

Southeast Asia - Tue, November 19, 2024 | 8:00 pm GMT+7

Vietnam’s inconsistent legal framework poses problems for FDI sector: Deep C exec

Vietnam’s inconsistent legal framework poses problems for FDI sector: Deep C exec

Vietnam’s legal framework lacks consistency and the foreign direct investment (FDI) sector will soon face challenges related to the Law on Environmental Protection, says Bruno Jaspaert, CEO of Deep C Industrial Zones.

Economy - Tue, November 19, 2024 | 6:30 pm GMT+7

Vietnam shares sink on extended foreign selloffs

Vietnam shares sink on extended foreign selloffs

Vietnamese equities fell for a fourth consecutive day on Tuesday as foreign traders extended their selling spree.

Finance - Tue, November 19, 2024 | 5:10 pm GMT+7

Germany’s household product firm QuickPack to invest $32 mln in Vietnam

Germany’s household product firm QuickPack to invest $32 mln in Vietnam

Germany’s QuickPack, a specialist for household goods and hygiene products, will invest €30 million ($31.8 million) in Vietnam’s Mekong Delta province of Long An.

Industries - Tue, November 19, 2024 | 4:24 pm GMT+7

Malaysian millionaire willing to invest in convicted Vietnamese tycoon’s property project: lawyers

Malaysian millionaire willing to invest in convicted Vietnamese tycoon’s property project: lawyers

Malaysian millionaire Vincent Tan has evinced investment interest in a residential project owned by convicted tycoon Truong My Lan, chairwoman of Van Thinh Phat Group, lawyers for the latter have disclosed.

Real Estate - Tue, November 19, 2024 | 4:17 pm GMT+7

‘Bottleneck of bottlenecks’ continues to dog Vietnam's property, infrastructure projects

‘Bottleneck of bottlenecks’ continues to dog Vietnam's property, infrastructure projects

Limited consultations between state agencies and the parliament’s primary focus on wording are issues with Vietnam’s legal framework adversely affecting property and infrastructure projects, say experts and corporate leaders.

Economy - Tue, November 19, 2024 | 3:40 pm GMT+7

President Xi Jinping hastens construction of 3 Vietnam-China rail routes

President Xi Jinping hastens construction of 3 Vietnam-China rail routes

Chinese President Xi Jinping has called for more substantial cooperation between China and Vietnam, including the pacier implementation of three railway routes linking the two nations.

Infrastructure - Tue, November 19, 2024 | 3:08 pm GMT+7

Vietnam developers offer deferred principal payments, interest support to boost year-end sales

Vietnam developers offer deferred principal payments, interest support to boost year-end sales

Vietnamese housing developers are offering several incentives including deferred principal payments and interest support to stimulate demand and boost liquidity as the year nears its end.

Real Estate - Tue, November 19, 2024 | 2:29 pm GMT+7

Australia's EQ Resources acquires TMG Group with Vietnam-based ferrotungsten factory

Australia's EQ Resources acquires TMG Group with Vietnam-based ferrotungsten factory

Australia-based EQ Resources Limited has acquired its fellow firm Tungsten Metals Group (TMG), which owns and operates the largest ferrotungsten (FeW) factory outside China.

Companies - Tue, November 19, 2024 | 11:00 am GMT+7

Techcom Securities becomes largest broker in Vietnam by capital base

Techcom Securities becomes largest broker in Vietnam by capital base

Techcom Securities JSC (TCBS) has become the largest securities company in Vietnam by charter capital after finishing a rights offering last week.

Finance - Tue, November 19, 2024 | 9:11 am GMT+7

Vietnam airport operator ACV looks to better exploit non-aviation service potential: exec

Vietnam airport operator ACV looks to better exploit non-aviation service potential: exec

Vietnam's airports operator ACV expects to earn $145 million from non-aviation services this year, accounting for around 18.83% of its total revenue, which is modest compared to other countries, said deputy general director Nguyen Duc Hung.

Companies - Tue, November 19, 2024 | 7:45 am GMT+7

The Investor to host seminar on removing legal bottlenecks for infrastructure, property investment

The Investor to host seminar on removing legal bottlenecks for infrastructure, property investment

A seminar themed “Removing legal bottlenecks for infrastructure and property investment” will be organized by The Investor in Hanoi on Tuesday.

Companies - Tue, November 19, 2024 | 7:00 am GMT+7

Indonesia promises Asia-Pacific investors more incentives

Indonesia promises Asia-Pacific investors more incentives

Indonesian President Prabowo Subianto recently told the press that he will create more incentives and expand special economic zones (SEZs) so as to lure investors from Asia-Pacific.

Southeast Asia - Mon, November 18, 2024 | 11:01 pm GMT+7

Indonesia, Brazil enhance aviation cooperation

Indonesia, Brazil enhance aviation cooperation

Indonesia's state-owned aircraft manufacturer, Dirgantara Indonesia (DI), and Brazilian aerospace company Embraer have signed a memorandum of understanding (MoU) to expand collaboration in the commercial aviation sector.

Southeast Asia - Mon, November 18, 2024 | 11:00 pm GMT+7