Africa Sales proceeds in Africa fell to EUR 311 million due to declining sales and lower exchange rates. Profitability was also sharply lower. Exports to Africa however, increased. In Africa, a divide is becoming visible. On the one hand, economic development in a number of countries is positive; on the other, there are countries where as a result of internal and external conflicts, the economy and purchasing power are showing a decline. The latter resulted in lower sales by our breweries, especially in the Democratic Republic of Congo, Congo, Burundi, Rwanda, Sierra Leone and Angola. A special word of thanks goes to our employees in Africa, who with great motivation and commitment have enabled our companies to operate and, in view of the often difficult circumstances, have achieved satisfactory results. Sales in the Democratic Republic of Congo were under pressure. The position of the local currency also weakened further. This led to a drop in profita bility. We increased our interest in Bralima last year from 88% to 94%. The bottle factory established in Kinshasa saw its sales shrink as a result of a decline in the beverages market. Although the trade embargo against Burundi was lifted in early 1999, the effects can still be felt. The brewery has increasing problems in purchasing raw materials and packaging materials. Sales were consequently under pressure. Sales in Congo, were virtually at the same level as the previous year in spite of the unrest in the country. In Rwanda sales showed a continuing decline, due in part to an increase in the excise duty on beer. In Reunion, a new soft drinks factory, which has been built on the site of the brewery, has been commissioned. Both turnover and results remained at last year's level. In Chad, Brasseries du Logone introduced a new beer named Chari onto the market. Although this product was well received by consumers, sales were disappointing due to competition from imported beers and the lack of transport facilities during the rainy season. Heineken acquired the remaining 50% of the shares in Brasseries du Logone. As a result of fierce competition Ghana Breweries in Ghana was unable to maintain its market share entirely. Sales were at the 1998 level. The process of integrating the two breweries, KBL and ABC, that merged in 1998 was continued successfully and led to substantial savings. This yielded better results. The brewery in Sierra Leone was unable to produce for the entire year as a consequence of the political situation. Parts of the brewery were damaged in the fighting. The beer market in Nigeria once again showed a substantial increase as a result of the abolition of excise duty on beer during 1998. Nigerian Breweries, in which we increased our interest to 40%, achieved a considerable rise in sales. Its market share also improved. A comprehensive programme of investments has been set in motion. Work is being done on a vitalization of the brewery's range of beers. In South Africa sales of Amstel beer brewed under licence rose considerably thanks in part to the introduction of a larger bottle. Sales of imported Heineken beer also grew. Efforts in the sphere of education and training were continued and augmented. The number of training programmes at our African branches, at our own specialist training institutes in Kinshasa (DRC) and Lagos (Nigeria), as well as in Europe was expanded and the number of trainees increased. Together with a number of international organizations Heineken is involved in several medical projects. These projects are in addition to the medical care that we already provide in Central Africa. This care covers all our employees and their families, a total of about 62,000 people. Due to a lack of sufficient public health care, the care we provide constitutes an exceptionally important element of our overall policy. In 1999, for example, a new medical clinic was opened at the Kinshasa brewery which provided high-quality medical care to many tens of thousands of visitors. A similar care policy will be developed in West Africa as well. Sales proceeds in Africa fell to EUR 311 million as a result of lower sales and a drop in exchange rates. Profitability was also sharply lower. HEINEKEN N. V. REVIEW OF THE EXECUTIVE BOARD 19 9 9 31

Jaarverslagen en Personeelsbladen Heineken

Jaarverslagen | 1999 | | pagina 33