2002 2001 Change
Financial Review
Net turnover
in billions of euros
Wines and spirits
0.5
Soft drinksI* Beer
Other income
0.3
Net turnover and cost of sales
Net turnover in 2002 was up by 10%, at €10,293 million,
an increase of €960 million, with first-time consolidations
accounting for half of this increase. Organic growth in net
turnover amounted to 6%, with a 4% increase accounted
for by improved selling prices and a better sales mix and
2% due to higher sales volume. Exchange rate movements
had the overall effect of depressing net turnover by 1%.
The following changes in the consolidation took place
in 2002. The 49.9% participating interest in BrauHolding
International, in Germany, a joint venture of Heineken N.V.
and Bayerische BrauHolding AG, has been proportionally
consolidated with effect from 1 January 2002. In 2001,
this participating interest was carried at net asset value.
In addition, Al Ahram Beverages Company in Egypt,
Almaza in Lebanon and Barb in Panama have been fully
consolidated with effect from 1 October 2002. A number of
beverage wholesalers in France, Italy and Switzerland
were also consolidated. And during the year we increased
our interests in Heineken Espaha from 97.2% to 97.8% and
in Heineken Slovensko, in Slovakia, from 87.7% to 91.6%.
In 2002, part of the costs of temporary point-of-sale
activities were reclassified as marketing and selling
expenses. To facilitate comparison, these costs have been
similarly reclassified in the 2001 figures, increasing both
net turnover and marketing and selling expenses in 2001
by €170 million. The operating profit was unaffected.
Operating expenses rose by 9.8% to€9,011 million, half
of this increase being accounted for by the new consolida
tions. The price of raw materials and the cost of packaging
increased slightly, as did energy costs. There was once
again heavy investment in strengthening our brands and
market positions, lifting marketing and selling expenses
by 9% to €1,585 million. Expressed as a proportion of net
turnover, these costs amounted to 15.4% compared with
15.5% in 2001.
Project costs not qualifying for capitalisation were lower
than in 2001.
Staff costs were higher, reflecting the increase in the num
ber of employees due to new consolidations and additional
pension charges. A total of €70 million in additional pension
charges was borne in 2002. It was possible, however, to set
off half of this additional pension charge against existing
provisions for staff costs. There were extra write-downs
in particular of stocks of finished products and spares.
Operating profit and net profit
The operating profit rose by 14% in 2002 to €1,282 million.
The greater part of this increase was due to the higher
sales volume, the improvement in the sales mix and the
higher selling prices. The newly acquired participating
interests, which were included in the consolidation for
Turnover and costs
in millions of euros
Net turnover
Raw materials, consumables and services
Excise duties
Staff costs
Amortisation/depreciation and value adjustments
Total operating expenses
Operating profit
10,293
9,333
10
5,558
5,089
9
1,282
1,226
5
1,642
1,417
16
529
476
11
9,011
8,208
10
1,282
1,125
14
REPORT OF THE EXECUTIVE BOARD
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