Regional review - Central and Eastern Europe continued
28 Report of the Executive Board
In 2007 and January 2008, Heineken continued
the expansion of its business in the region through
a series of targeted acquisitions. At the end of
2007 the Krusovice brewery was acquired in the
Czech Republic, whilst the acquisition of the Rodic
brewery in Serbia was announced. Early 2008,
Heineken established a partnership with Efes
Breweries International that will invest in
the growing Uzbek beer market. In addition,
both companies intend to merge the brewing
operations in Serbia and Kazakhstan, leading to
number two market positions in both countries.
Russia
Consolidated beer volume 15.0 million hectolitres
Market share 12.8 per cent
Market position3
The winter and spring were exceptionally mild
in Russia leading to exceptionally strong market
growth. Beer volume of Heineken Russia grew
16 per cent, passing 15 million hectolitres. Total
volume of the seven strategic brands, representing
around 60 per cent of the portfolio, grew faster
than the overall market increasing 18 per cent.
Poland
Consolidated beer volume 11.8 million hectolitres
Market share 33.0 per cent
Market position2
Beer volume increased 7.3 per cent, with
a stronger performance in the high-end segments
of the market. In particular the Heineken brand
performed well, growing at 13 per cent and
gaining share in the international premium
segment. Zywiec, the national premium brand,
grew high single digit driven by higher domestic
volumes and an increase in export mainly to the
USA and UK. As a result of its double digit volume
growth, Warka's market share grew.
Revenue of Grupa Zywiec saw a double-digit
growth rate with volumes accounted for half of
the increase and higher prices, a better sales mix
and a positive currency effect accounting for the
remainder. EBIT (beia) grew significantly, helped by
costs savings in production and the introduction of
a shared service centre.
Volume of the Heineken brand grew nearly
40 per cent. Amstel Pulse continued to develop
well, driven by consistent marketing, the
introduction of a 50cl bottle and the increase
in numerical distribution. Ochota, our key brand
in the mainstream segment and Three Bears
(positioned at the top end of the economy
segment) grew strongly. Volume of the Botchkarov
brand was slightly lower.
Revenue grew at a double-digit rate, despite the
effect of the lower rouble against the euro. EBIT
(beia) increased, driven by the effect of higher
revenue that was only partially offset by the
impact of higher input costs and marketing
investments. Production capacity is being
upgraded and expanded, and headcount at
the breweries continued to reduce.
Heineken N.V. Annual Report 2007