Report of the Executive Board
8
As stated in the Recommendations of
the Supervisory Council, Mr. H.H.
Thyssen-Bornemisza has signified his
wish to retire from the Supervisory Coun
cil of our enterprise. We take this oppor
tunity to thank Mr. Thyssen-Bornemisza
for the valuable advice which he has
frequently given and the great interest
which he has shown during the more
than 20 years that he has been asso
ciated with our enterprise as a member
of the Supervisory Council.
1986 in brief
Heineken has had a satisfactory year.
Net turnover and profit again showed an
increase, whilst the international expansion
of the enterprise continued successfully.
Breakdown by geographical area of beer brewed under the supervision of Heineken:
(in thousands of hectolitres) 1986 1985 increase
Europe
25,512
24,826
2.8
Western Hemisphere
7,747
6.188
25.2
Africa
6.475
6.233
3.9
Asia/Australia/Oceania
2,372
2.366
0.3
42.106
39,613
6.3
Net turnover rose by 4.4% in 1986 to
N.fl. 6,684 million. The increase was
partly due to higher beer sales and exten
sion of the consolidation. As a result of
the enlargement of the interest in the
Spanish brewery group El Aguila S.A.
from 37.8% to 51.2%, this subsidiary
was fully consolidated in the year under
review; in 1985 proportionate consolida
tion already took place.
Furthermore, for the first time the brewery
enterprises Sarde Produzioni Agricole
Industriali S.p.A. in Italy and Brasseries
de Bourbon S.A. in Réunion were in
cluded in the consolidation.
Net profit rose by 7.5% in 1986 to
N.fl. 285 million, mainly as a result of the
higher sales.
The trend of net turnover and profit is
more accentuated if the unfavourable
effect of currency developments is taken
into account.
In relation to the currencies in a large
number of countries where Heineken has
interests, the guilder rose in value com
pared with 1985. This led to lower results
translated into guilders of proceeds and
earnings of foreign consolidated partici
pations. In addition, the strong guilder
had an inhibiting effect on the develop
ment of exports to a number of areas.
Nevertheless, exports to the Western
Hemisphere increased.
Total sales of beer brewed under the
supervision of Heineken rose by 6.3%
in 1986 to 42.1 million hectolitres. This
includes the beer output of affiliates and
the beer brewed under licence by third
parties.
In Europe we have succeeded in improv
ing the market position in a number of
countries, whilst beer sales were also
stimulated by the good summer weather.
The process of rationalization and mod
ernization in France and Spain was ac
companied by sizeable investments and
reorganization costs. The efforts in the
field of marketing and promotion were
also substantial in those countries. It can
be noted with satisfaction that the effects
of the measures taken are becoming
visible more rapidly than was expected.
Sales in other continents showed a slight
overall increase.
In the course of time Heineken has devel
oped into one of the world's biggest brew
ery groups. In Europe, Heineken has
grown to be an integrated brewery enter
prise with a leading position in many
major European markets. During the year
under review further expansion has once
again been a dominant feature of policy.
In Great Britain the contract with
Whitbread regarding the production and
marketing of Heineken beer under licence
was revised. Within this framework
Heineken received part of the royalties
accruing to it in the form of shares. The
enterprise thereby acquired an interest
of approximately 1 in Whitbread's share
capital. Mr. A.H. Heineken also joined
the Board of Directors of Whitbread
Co. PLC as a non-executive director.
