Canada
South America
Other countries
Sales and market share growth
Heineken brand strong and growing
54 Heineken N.V. Annual Report 2004 Report of the Executive Board Regional Review The Americas
The Canadian beer market is shrinking due to the resurgence of wine and spirits as well as the
impact of smoking bans on the on-premise segment. The Heineken brand continues to improve its
position in the imported beer segment with considerable growth in the Ontario and Quebec markets.
Sales volumes jumped in the key South American markets of Chile and Argentina in 2004.
Through our proportionately consolidated interest in Chile's top brewer, CCU, beer volumes increased
to 5.9 million hectolitres.
CCU, has approximately a 90% market share in the beer market in Chile. CCU Argentina has a solid
second position in the Argentinean beer market with approximately 16% market share. CCU markets
a number of lager brands and specialty beers in Chile and Argentina. CCU started brewing Heineken,
both in Chile and Argentina, in June 2003.
In addition to beer, CCU produces wine, soft drinks, fruit juices and mineral water. It also produced
0.8 million hectolitres of wine, of which approximately half was exported to various European coun
tries and to Brazil.
Strategically, Heineken and CCU complement one another perfectly, and the cooperation has
enhanced the Heineken brand's growth potential in Chile and Argentina. In Argentina in particular,
the addition of the Heineken brand to CCU's portfolio has created good opportunities for expanding
the distribution, which benefits the growth of CCU's other brands as well as the Heineken brand.
In Chile, the beer market in volume terms held relatively steady, however, in operating profit terms
improved due to better prices, supported by a stronger economy. Heineken brand volume improved
34% during 2004, leading the growing premium segment. The operational result of both soft drinks
and wines improved in 2004.
With the improvement in Argentina's economy, the beer market has grown and prices have
increased. In this growing market, CCU has increased its market share by almost two percentage points,
selling 2 million hectolitres. Heineken beer volume increased 17% during 2004, leading the premium
segment.
Due to the weak performance of Kaiser in Brazil, Heineken reduced the carrying value of its 20%
stake from €190 million to zero during the year.
In Colombia, sales of imported beer were depressed by the strong euro.
In 2004, the Heineken brand was re-launched in Uruguay, where our previous partner Quilmes
had distributed it until 2003.
