Netherlands
Spain
Regional Review
Europe
Rising result in a contracting market
The Dutch beer market was rather lacklustre in 2001.
Lagers gained market share at the expense of alcohol-
free beers and sales of speciality beers remained stable.
Our beer sales in the Netherlands declined from 6.7 to
6.5 million hi. There was no growth in the Group's market
share in the Netherlands, but the sales mix improved and
the result was slightly higher.
Sales were adversely affected by the weather and
impaired consumer mobility due to the travel restrictions
imposed in connection with the outbreak of foot-and-
mouth disease. Demographic factors and the growing
competition from wine and premixed spirits also exerted
pressure on the beer market. Heineken's share of the
beer market was negatively affected by the ban on the
sale of alcoholic beverages at filling stations, a sales
channel in which Heineken was relatively strongly repre
sented.
The initial results of the new advertising campaign for
the Heineken brand were encouraging. Amstel's market
share and sales were down slightly. The successful 'Three
Friends' campaign was expanded and more sponsored
concerts tied into the hit TV programme 'The Friends of
Amstel Live' were staged. The launch of Amstel Bright,
a pale lager in a clear bottle which is imported from
Curagao, exceeded expectations.
A new bottling line serving our export markets was
installed at the Zoeterwoude brewery in 2001. This new
line, which has raised efficiency and expanded capacity,
entered service early in 2002. The efficiency and effec
tiveness of our production and distribution, marketing
and sales and central services functions were maximised
by organising them under three separate companies.
A new management information system, supporting the
operations of Heineken Nederland, Heineken USA and
Heineken Export Group, was introduced.
Heineken Nederland was pleased to learn of the shelv
ing of the plans to introduce a can deposit. Such a
system would impose heavy costs on the industry, but
would do little to reduce the volume of litter. It would
also encourage fraud, because the deposit far exceeds
the production cost.
Growth in the soft drinks and mineral water market
was constrained by the poor summer. Sales of special
soft drinks such as iced tea and fruit-based soft drinks
continued to advance, bringing pressure to bear on sales
of more traditional soft drinks such as cola, orange and
lemon/lime. Branded soft drinks increased their share of
the total market. The keen competition on the take-home
market was exacerbated by the large number of new
entrants.
Vrumona, our soft drinks company, maintained its mar
ket position. The market shares of Pepsi and 7-Up, which
are produced under licence, remained stable and Sisi
sales continued to grow. Work continued on the develop
ment of the Xi brand and Xi Climax was launched suc
cessfully in the on-trade sector. With the acquisition of
the Crystal Clear brand, Vrumona secured a position in
the fruit-flavoured mineral water take-home market.
Higher volume despite compulsory sale
of regional brands
The Spanish beer market enjoyed a sixth consecutive
year of growth in 2001. Heineken Espana's beer sales
increased from 10.0 to 10.4 million hi and its market
share was virtually unchanged, despite the sale of two
breweries and a number of regional brands which was a
government-imposed condition of the acquisition of
Cruzcampo in 2000. Heineken Espaha posted an
improved result.
Through a public offer, Heineken increased its sharehold
ing in Heineken Espaha to 97.2%. The Heineken,
Cruzcampo and Aguila-Amstel brands reported strong
growth, replacing the volume of the brands which had
been sold making it necessary to increase capacity at
the remaining breweries. Heineken Espaha successfully
launched several new beers and packaging variants,
including Amstel 1870, Amstel Oro and Cruzcampo Big,
in an innovative wide-necked bottle. The sales mix
improved. While the large market in Spain for alcohol-
free beer contracted, the Buckler and Kaliber brands,
which occupy leading positions on that market, recorded
increased sales.
The principal brands were strongly supported with
marketing campaigns and sponsorship of events such as
the FIB-Heineken Music Festival, which drew a European
audience. Aguila-Amstel also benefited greatly from its
sponsorship of the UEFA Champions League, helped by
the success of the Spanish soccer teams.
Steady progress was made with the integration of El
REPORT OF THE EXECUTIVE BOARD
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