97
Notes to the Consolidated Financial Statements
2023
2022
213
174
91
80
304
254
Introduction
See the table below for the key assumptions:
Haiti
In
2023-2026
2027-2032
33.5
33.5
5.9
5.9
5.5
4.4
For the contractual commitments on ordered P,P&E refer to note 13.2.
2023
2022
836
830
204
183
1,040
1,013
Pre-tax WACC (in local currency)
Expected annual long-term inflation
Expected volume growth
HEINEKEN estimates the expected residual value per asset item. The residual value is the higher of the expected
sales price (based on recent market transactions of similar sold items) and its material scrap value.
Sustainability
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of the
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of the
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Land and buildings include the breweries and offices of HEINEKEN as well as stores, pubs and bars. The plant
and machinery asset class contains all the assets needed in HEINEKEN's brewing, packaging and filling activities.
Other fixed assets mainly consist of returnable packaging materials, commercial fixed assets and furniture,
fixtures and fittings. Refer to note 7.4 for further information on returnable packaging materials that are
included in this category.
Impairment losses
Impairments of €68 million on goodwill (2022: nil), €158 million on owned property, plant and equipment
(2022: €27 million, net impairment reversal), €42 million on intangible assets with finite useful life (2022: €189
million, net impairment reversal) and €14 million on right of use (ROU) assets (2022: €4 million, impairment
reversal) were recorded for the year ended 31 December 2023. The impairments mainly relate to Brasserie
Nationale d'Haiti S.A. (Haiti) for €139 million which is included in the Americas operating segment.
The impairment for Haiti relates to hyperinflation accounting, which was applied for the first time during the
year ended 31 December 2023. Fixed assets are revalued for the inflation since they were acquired, which
resulted in an increase in the carrying value of fixed assets.
The determination of the recoverable amount of the assets of Haiti is based on a VIU valuation, which is based
on a discounted 10-year cash flow forecast. The key assumptions used to determine the cash flows are based on
market expectations and management's best estimate. Cash flows thereafter are extrapolated using a perpetual
growth rate equal to the expected 30-year compounded average inflation, in order to calculate the terminal
recoverable amount.
Right of use (ROU) assets
HEINEKEN leases stores, pubs, offices, warehouses, cars, (forklift) trucks and other equipment in the ordinary
course of business. HEINEKEN has around 35,000 leases with a wide range of different terms and conditions,
depending on local regulations and practices. Many leases contain extension and termination options, which are
included in the lease term if HEINEKEN is reasonably certain to exercise the option. Refer to the table below for
the carrying amount of ROU assets per asset class per balance sheet date:
IAS 29 requires entities that apply hyperinflation accounting for the first time to recognise impairment related to
prior periods in opening equity. The impairment for Haiti related to prior periods (€135 million) is recorded in the
retained earnings balance as at 1 January 2023. The impairment charge relating to the current year (€4 million)
and other impairments are recorded on the line 'amortisation, depreciation and impairments' in the income
statement. For a split per asset class, refer to the movement schedules in notes 8.1 and 8.2.
In 2023, €350 million was added to the ROU assets as a result of entering into new lease contracts and the
remeasurement of existing leases (2022: €218 million). The depreciation and impairments of ROU assets for the
financial year ending 31 December is as follows:
Depreciation is charged to profit or loss on a straight-line basis over the estimated useful lives of items of P,P&E.
HEINEKEN believes that straight-line depreciation most closely reflects the expected pattern of consumption of
the future economic benefits embodied in the asset.
Accounting policies
Owned assets
A fixed asset is recognised when it is probable that future economic benefits associated with the P,P&E item will
flow to HEINEKEN and when the cost of the P,P&E can be reliably measured. The majority of the P,P&E of
HEINEKEN are owned assets, rather than leased assets.
P,P&E are recognised at historical cost less accumulated depreciation and impairment losses. Historical cost
includes all costs directly attributable to the purchase of an asset. The cost of self-constructed assets includes all
directly attributable costs to make the asset ready for its intended use. Spare parts that meet the definition of
P,P&E are capitalised and accounted for accordingly. If spare parts do not meet the recognition criteria of P,P&E,
they are either carried in inventory or consumed and recorded in profit or loss.
Subsequent costs are capitalised only when it is probable that the expenses will lead to future economic benefits and
can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised
when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which
they are incurred.
Judgement is required to determine the lease term. The assessment of whether HEINEKEN is reasonably certain to
exercise such options impacts the lease term, which as a result could affect the amount of lease liabilities and ROU
assets recognised.
Accounting estimates and judgements
Estimates are required to determine the (remaining) useful lives of fixed assets. Useful lives are determined
based on an asset's age, the frequency of its use, repair and maintenance policy, technology changes in
production, redundancies or changes due to climate risks and expected restructuring.
Heineken
N.V.
Annual
Report
2023
In millions of
Land and buildings
Equipment
Carrying amount ROU assets as at 31 December
In millions of
Land and buildings
Equipment
Depreciation and impairments for ROU assets
