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1
Austria
Other countries
Stable operating result and higher market share
Heineken N.V. Annual Report 2004 Report of the Executive Board Regional Review Central and Eastern Europe
Brands
All of our key brands in Russia grew strongly in 2004, with Ochota showing the biggest volume growth
of about 50%. The only exception was Botchkarov, which faced strong competition and consequently
suffered a volume decline. Botchkarov was awarded the prestigious DLG gold medal for quality in
Germany.
In its second year of local production, the Heineken brand, helped by an increase in the inter
national premium segment, grew more than 100%.
Market developments
Excise duty was increased by 11% in January 2004, in line with inflation, and had a negligible impact
on the market. The Duma drafted and adopted two pieces of legislation that affect the beer market
directly. A selective restriction was imposed on the advertising of beer. This will restrict the time and
content of the beer advertisements on television and prohibits the placing of billboards and other
advertising materials close to schools. Secondly, new restrictions on the sale and consumption of beer
in public places were discussed. We expect possible measures to have only a limited impact on the
future growth of the beer market.
After an exceptionally good 2003 in terms of
volume development, the Austrian beer
market fell 1.3% to 9.0 million hectolitres in 2004.
Outperforming the market, Brau Union
Österreich slightly improved its market share
and confirmed its position as the most important
brewery group in Austria.
The total beer sales volume of Brau Union Österreich amounted to 4.8 million hectolitres, having
grown steadily over the last few years. In 2004 Brau Union Österreich was able to raise prices and
lower costs, although the operating result declined, because of sharply increased marketing
investments.
Brands
The Heineken brand was re-launched in March 2004, following transfer of sales and distribution
responsibility from a wholesale partner to Brau Union Österreich. Strong marketing boosted brand
volume by 50% and the launch campaign won a prestigious industry award.
Volumes of the national premium brands, Zipfer and Gösser, fell slightly, whereas the mainstream
brands showed an increase in volume. Our speciality beer, Edelweiss, registered slightly lower volume,
but our alcohol-free beer, Schlossgold, grew significantly.
t
In Romania, the beer market grew 4% in 2004. Most of the growth came in the lower priced segment
of the market, driven by a significant increase in the popularity of PET packaging.
Beer sales volume of Brau Union Romania fell to 3.6 million hectolitres and market share decreased.
This fall was almost entirely due to a new local entrant in the market, competing on price.
The international premium beer segment grew, and locally brewed Heineken was successfully intro
duced in December. In the first few months of local production, sales of Heineken exceeded targets.
Our overall operating result in Romania decreased.
Total beer sales
million hectolitres
Market share
percent
Market position
position
