I
I
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The total market for Dutch spirits grew more than
was expected in the past year. This growth was
largely the consequence of lower prices which aro
se from the price competition, as a result of which
there was also a shift from foreign to Dutch prod
ucts. This price competition has gradually develo
ped into a price war.
Our market share increased.
With Jagermeister we were able to improve our
position in the herbal bitter market, with the price
being maintained at the same level. Since October
1, 1978, the Bokma products, too, have been mar
keted in one-trip packaging.
The sales of the products of our wine group gene
rally developed satisfactorily. The market share
showed a noticeable improvement.
As from the beginning of the new financial year, the
activities of the spirits group and the wine group
have been combined in the Spirits and Wine Group.
Beer sales in the rest of Europe
brewed under the supervision of Heineken
(in millions of hectolitres)
1977/78
6.6
1976/77
1975/76 r
6.1
6.2
v:
1974/75 I
1973/74
5.5
5.5
Rest of Europe
As we have mentioned in earlier Annual Reports,
the French government has in previous years fol
lowed a very stringent pricing policy with regard to
beer, which has led to a financial weakening of the
brewing industry.
In the meantime it has recognized that the restora
tion of the profitability of industry, and thus also of
the brewing sector, is an important condition for the
battle against inflation and for the combating of
unemployment. In this context, in August 1978 the
French brewing industry was given freedom to fix
its prices independently within certain norms. Al
though this development will undoubtedly have its
effect in the longer term on the restoration of profi
tability, its short-term effect must not be overes
timated.
Total beer consumption in France was somewhat
lower in the year under review than in 1976/1977.
The domestic sales of our breweries were
maintained at the level of the previous financial year.
During the financial year the extent of the price
increase allowed was again too small to cover the
rises in costs.
The sales of Heineken beer in France were virtually
the same as in the previous year. The profit con
tribution of these sales was very adversely affected
by a price measure in the hotel, restaurant and café
sector, which especially hit imported beers. This
measure was discontinued in March 1978.
The above-mentioned factors were the reason why
the trading result was lower than in 1976/1977, in
which year the trading result was not positive either.
Although a slight improvement is noticeable, busi
ness in Italy is greatly affected by the uncertain
political and economic climate and the continuing
high level of inflation. The beer market as a whole
has shown a slight growth.
There was a rise in the sales of the Heineken and
Dreher brands compared with the previous year.
The market share of both brands increased. A gra
dual change in the commercial organization and in
the market approach have resulted in an enhanced
ability to make a quick response.
Partly due to price increases, the trading result of
the Dreher group was higher than in the previous
year.
In Greece the brewing industry has been able to
benefit from the expansive growth which the eco
nomy has shown in recent years. The result of this
growth was a rise in the gross national product, an
increase in employment and a higher consumption.
In the summer months we were unable to meet
completely the sharply increased demand for beer,
as a result of which some market share was lost.
Nevertheless we amply benefited from the market
growth, which was also reflected in the financial
results. Maintenance of the position as market
leader compels our affiliated enterprise to make
substantial extensions of capacity.
The following may be stated with regard to the
beers produced in Europe by third parties under
licence.
In Britain, lager has obtained a bigger share of the
total beer market in the year under review. This
trend is expected to continue in the years ahead.
Sales of Heineken beer brewed under licence by
Whitbread Co. Ltd. developed well and excee-
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