J
Switzerland
Ireland
Other Western
European countries
Regional Review
Western Europe
MER
and Braustolz performing well. The activ
ities of the Scherdel brewery, which oper
ates in the same region and was acquired
in October 2003, will be integrated into
Kulmbacher's organisation.
Karlsberg had a difficult year, due to its
relatively strong position in the canned-
beer segment, but managed to hold the
loss of sales volume at 9%, by introducing
new packaging and other measures.
Karlsberg nevertheless made a satisfac
tory contribution to earnings in the first
year of its inclusion in the consolidation.
Sales of Desperados, our international
speciality beer, which had grown strongly
in Germany in 2002, fell back abruptly
last year as a result of the new packaging
charges, coupled with strong competition
from ready-to-drink mixes.
Higher sales and an improved result
Profiting from the very hot summer, the
Swiss beer market recorded modest growth.
Heineken Switzerland's beer sales were up
from 760,000 hectolitres to 805,000 hecto
litres and the result improved slightly, mainly
due to cost savings.
Growth in the beer market was restrained
by the continuing weakness of the econo
my and on-trade sales declined. Heineken
Switzerland maintained its market share.
Heineken brand sales remained stable and
the local brands achieved modest growth.
The BeerTender®, a dispenser for home
use, was launched on a trial basis and
more David dispensing systems were
installed at on-trade outlets. Draught beer
volume increased at the expense of other
packaging variants.
The modernisation of the fully automat
ed distribution centres in Domat Ems was
completed in the third quarter of 2003 and
the wholesalers which had been acquired
by Heineken Switzerland earlier in the year
were fully integrated into the organisation.
The Irish beer market, which contracted
significantly in 2003, is expected to continue
on its downward trend, in the light of the
government's plans for a more restrictive
alcohol policy and a smoking ban in pubs,
bars and restaurants. Despite the shrinking
market, Heineken Ireland's sales remained
stable at 1.1 million hectolitres and it
increased its market share.
The worsening economy, waning
consumer confidence and the public
debate on alcohol and health all brought
pressure to bear on the beer market.
Lager volume was down a little, while stout
sales again declined sharply. Lager now
accounts for over half of total beer sales.
The Heineken brand strengthened its
leading market position in the lager beer
segment. Sales of Murphy's Stout were
down, following the trend in the stout
segment, but Coors Light, which is brewed
under licence, and Amstel recorded
vigorous growth.
The Heineken brand was supported by
sponsorship of the Green Energy music
event and the Green Room Sessions. There
was also a tie-in with Heineken's
sponsorship of the European Rugby Cup
and the Rugby World Cup in Australia,
in which there was exceptionally strong
interest in Ireland.
Heineken beer with a 5% alcohol content
was launched in the premium segment in
the United Kingdom in 2003, and
Heineken Cold Filtered, a beer brewed to
a different recipe, was withdrawn. As a
consequence, sales in the UK decreased
from 2.1 million hectolitres to 0.6 million
hectolitres.
While the UK beer market overall showed
little growth, lager beers continued to gain
in popularity and now account for 39% of
the total beer market. In this segment,
the premium lagers recorded the fastest
growth, at 2.4%. For historical reasons, the
position of Heineken beer in the UK, which
is available worldwide, is still modest.
The relaunch of the Heineken brand was
given intensive marketing support. In the
'Heineken, you have changed' PR
campaign, UK celebrities posed for a top
photographer in barely recognisable
guises. The advertising campaign, which
emphasised that the 'new' Heineken beer
has a 5% alcohol content, had as its theme
'Heineken: tested around the world, now
ready for the UK.' Various promotions,
local sponsorship, on-trade support to
ensure optimum draught beer quality and
the new international can and aluminium
bottle contributed to the successful
relaunch. The marketing strategy is fully
focused on sustainable brand
development.
Amstel was positioned in the main
stream segment, as in other markets
around the world. Amstel is now available
only on draught in the on-trade, which
enables Heineken to offer its on-trade
customers a more cohesive brand port
folio. Sales of Amstel developed well, but
sales of Murphy's Irish Stout and Murphy's
Irish Red, which are brewed under licence
and distributed by a partner, were lower.
The Affligem brewery in Belgium
reported sustained sales growth, with
REPORT OF THE EXECUTIVE BOARD
31