Report of the Executive Board Chief Executive's Statement
Transforming our platforms for future growth
Alongside meeting the challenges of our mature
markets we continued to invest in the emerging
world. In January 2010, we acquired the beer
division of Fomento Económico Mexicano, S.A.B.
de C.V. (FEMSA) in Mexico and Brazil. Following this
acquisition, we rapidly and successfully integrated
these businesses and welcomed FEMSA as a key
shareholder in the Fleineken Company.
Together with our joint venture partnership in
India's leading brewer, United Breweries, and the
strong growth of our Africa and Middle East region
(9.1 per cent) and our Asia Pacific region (6.2 per
cent), 2010 marked a step change in our exposure
to the emerging beer markets. At the end of 2010,
68 per cent of our Group beer volume and 57 per
cent of our EBIT beia was delivered from emerging
markets. At the end of 2009, these figures stood
at 55 per cent and 49 per cent respectively.
It demonstrates that our strategy to rebalance
the business and enlarge our platforms for future
growth is successful.
Meeting the challenge of Europe
We have recognised the challenge to grow both
volume and value share in Europe. A clear action
plan has been put in place to enable us to achieve
this. It involves utilising compelling consumer
insights for innovation; increased investment
behind our existing and our new higher-margin
brands such as Desperados®, Strongbow® and
Dos Equis®; continuing to invest in premiumisation
of the category and ensuring we have the
right capabilities to win in both the off- and
the on-trade channels. In parallel, we will place
more emphasis as both a company and an
industry on communicating the positive aspects
of beer in order to maintain its reputation as
a responsible category and an enjoyable part
of everyday adult life.
At the same time, we will maintain our financial
discipline, drive efficiencies and reduce the cost
of doing business throughout our organisation.
Changing the way we work
During the year, we undertook a significant review
of our business model. The growth in scale of
our Company in the last five years has been
tremendous: +74 per cent in volume; +59 per cent
in revenue; +64 per cent in employees; +55 per cent
in number of brands. As a result of this review, we
made changes to the governance and established
a new set of operating principles between Global
functions, Regions and Operating Companies
to better leverage our increased size and
Following this, in September, we announced
an important strategic move to create a new
Global Business Services organisation. This cross-
functional organisation, with direct representation
on our Executive Committee, will drive better
coordination and integration of various shared
services initiatives across the Company.
Taken together, the successful implementation
of these decisions will strengthen the unity of the
organisation and provide a more single-minded
focus to our efforts.
Creating a different type of sustainable value
Fleineken has always delivered actions that have
demonstrated our desire and intention to be
more than simply a business driven by profit.
In April, we increased our commitment to
building a sustainable business by launching
'Brewing a Better Future'. This ten-year approach
to Sustainable Development is based on three
Continually improve the environmental
performance of our business
Empower our people and the communities
in which we operate
Positively impact the role of beer in society.