its support of Pepsi-Cola and Sisi. Sales rose and
its market share increased slightly. Profitability
also improved thanks to a combination of higher
sales, somewhat better margins and cost control.
France
The beer market in France showed a modest
increase. Our operating company Sogebra
achieved higher sales and slightly improved its
market share. Higher sales, positive changes in
the sales mix and stringent cost control produced
a higher profitability. Sales of Heineken beer
achieved a double-digit increase. Amstel further
reinforced its position in the on-premise sector.
Growth was also to be seen in the mainstream beer
"33" Export. The distribution of "33" Export in PET
bottles has been expanded to cover all of France.
Although sales are rising, the volumes in PET
packaging are for the moment still modest. Of the
specialties, Desperados in particular continued
its swift rise both in France and other countries.
Our sales of low-priced beers fell marginally. The
export of our French beers to the United Kingdom
once again increased.
Italy
Beer consumption in Italy was slightly down on
the level of the peak year 1998. Heineken Italia
retained its market share and market leadership.
In spite of lower sales profitability still increased
thanks to an improvement in sales mix and in
productivity. The Heineken and Moretti brands
achieved higher sales. Extensive advertising
campaigns, high brand visibility and music
sponsorship reinforced the beer drinker's
preference for Heineken. Moretti developed into
the leading mainstream beer brand.
To further reinforce the brand, Moretti sponsored
a number of Italian football events. The Dreher
brand was repositioned and backed up by extensive
promotional activities, reinforcing the position
of Dreher in the off-premise sector. Ichnusa beer
retained its leading position in Sardinia.
The specialties too attracted increased consumer
interest.
Heineken Italia scored well in a customer and
consumer satisfaction survey. Nonetheless, the
survey provides new leads for further improving
service.
Spain
Thanks to the growing economy, increasing
tourism and the excellent weather, the beer market
expanded during 1999. Sales of our brewery
El Aguila grew more strongly than the market.
El Aguila's profitability improved substantially.
Sales of Heineken beer rose more than the market
average. Two new commercials were developed on
the 'Think green' theme. For the first time in years,
the growth of Aguila-Amstel exceeded the increase
in the market. The successful promotions and
sponsoring activities involving Aguila-Amstel beer
resulted in a rejuvenation of its image and the
influx of new consumers. In addition, the intro
duction of 30-litre kegs and other new types of
packaging supported the brand. Sales of Buckler
increased. El Aguila developed various cost-cutting
initiatives. Canary Islands sales of Heineken beer
also increased.
Heineken reached an agreement with Diageo
on the takeover of 98.7% of the shares in Spain's
largest brewing group, Cruzcampo. The Spanish
authorities approved the takeover subject to
a number of conditions. This makes Heineken the
market leader in this sizeable beer market and
presents the Heineken brand with much greater
sales potential. Cost savings and economies
of scale can also be achieved. The integration of
the brewery activities of Cruzcampo and El Aguila
will take a number of years.
C reece
The Greek beer market once again showed modest
growth. Mainstream beers grew faster than the
beer market as a whole. The volume of premium
beers was at last year's level. Athenian Brewery
achieved better profits thanks to higher sales
and cost savings. Sales of Amstel beer grew faster
than the market. The Heineken brand maintained
its leadership position in the premium segment.
nks to higher sales, a better sales mix, higher selling prices
reased considerably.
HEINEKEN N.V.
REVIEW OF THE
EXECUTIVE BOARD
19 9 9
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