Heineken, the world’s second-largest brewer, reported first-half earnings above expectations on Monday but warned of weakness in the rest of the year as costs eat into margins and the COVID-19 pandemic continues to hit key markets.
The maker of Europe’s top-selling lager Heineken, Tiger, and Sol, said operating profit before one-offs doubled to 1.63 billion euros ($1.93 billion), compared with the average forecast in a company-compiled poll of 1.22 billion euros.
Dolf van den Brink, who has been chief executive for a year, said the company was pleased with a strong set of first-half results but said there was the reason for caution, with results expected to remain below pre-pandemic levels in 2021 as a whole.
COVID-19 would remain a factor, with the biggest impact in key markets in Africa and Asia. Rising commodity costs would also start affecting Heineken in the second half of 2021 and would have a “material effect” in 2022.
Heineken previously forecast that market conditions should improve in the second half of 2021, depending on vaccine roll-outs.