Report of the Executive Board
Regional Review
continued
Russia
Consolidated beer volume 13.0 million hectolitres
Market share 13.2 per cent
Market position 3
The market developed very positively in 2006,
thanks to economic conditions, good weather and
an exceptional trading environment in the third
quarter. Our volumes grew well, both organically
and through the first-time consolidation of Ivan
Taranov. Volumes reached 13 million hectolitres.
Volumes grew across the portfolio, with the
Heineken brand up by more than 30 per cent,
and Ochota, our leading mainstream brand, up
by 26 per cent. We also recorded strong growth
in the premium portfolio, with Zlaty Bazant®,
Amstel Pulse, Bitburger®, Guinness® and Bud®,
|as well as with the recently acquired mainstream
brands. Three Bears®. Bochkarov® volumes
were lower.
Heineken Russia's revenues doubled as a result
of first-time consolidations, volume and price
growth. EBIT increased as well, mostly because
of the first-time consolidation. The increase
of our sales and marketing investment and
integration costs limited organic growth.
Amstel Pulse, introduced at the end of 2005,
recorded high sales and positive consumer
appreciation.
In 2006 we focussed on the integration of the
recently acquired brewers and development of
the existing business: we completed the first
brand portfolio review, identifying 14 key
strategic brands and 9 top premium brands.
We also completed the production allocation
study of the 10 breweries and defined our
distribution strategy. We introduced several
new products and packages, mostly new PET,
with good consumer response.
Poland
Consolidated beer volume 11.0 million hectolitres
Market share 33.6 per cent
Market position 2
The Polish beer market enjoyed another positive
year, up 6.4 per cent. Grupa Zywiec performed
very well, with volumes rising more than 8 per
cent and growth in all brands.
Zywiec, Poland's leading national premium brand,
reached 2.7 million hectolitres, which represents
an 8.3 per cent growth. Warka® Jasne Peine, our
mainstream brand, enjoyed a 25 per cent growth.
The Heineken brand had a good year too, up
14.7 per cent, confirming its leadership in the
international premium segment.
Revenues were ahead of last year, driven by the
strong volumes and a better sales mix. Costs
related to the brewery closure at Bydgoszcz at
the end of 2006 and other Fit2Fight-related costs
hit EBIT, which was slightly down on last year. EBIT
was also affected by changes in package and
channel mix.
In December Grupa Zywiec completed a buy back
of 5.3 per cent of its outstanding shares.
Germany
Consolidated beer volume 3.6 million hectolitres
Market position 4
The German beer market improved in 2006, after
several years of decline, thanks to the World Cup
soccer competition hosted there and favourable
weather conditions in the first half of the year.
BrauHolding International, our joint venture with
the Schorghuber Group, increased its volume
organically. In particular the speciality beer,
Paulaner® Weissbier, recorded a good year with
a volume growth of 14.2 per cent, in part driven
by exports. BrauHolding International became
the leader in the 'weiss' beer segment.
QO Heineken N.V.
Annual Report 2006
