Heineken N.V. issued on April, 22 its scheduled trading update for the first three months of 2009.

Better selling prices largely compensated for lower volumes, resulting, organically, in an EBIT (beia) only marginally lower, the Dutch brewer posted on its website.

In the first quarter of 2009, Heineken’s revenue increased 24% compared with the first quarter of 2008 owing to first-time consolidations (+27%) and better pricing (+6%). This was partially offset by the financial impact of lower volume (-7%) and unfavourable exchange rate fluctuations (-2%). Organically, revenue decreased 1%.

Heineken’s full-year results and volumes are far more dependent on the performance in the peak-selling season (May-August). The first quarter is the least significant in terms of volume and profitability. In 2007 and 2008, the first quarter accounted for 20% and 18% of annual consolidated beer volume respectively, the brewer said.

Consolidated beer volume grew 12% to 25.6 mln hl, due to the first-time consolidation of Scottish & Newcastle and other acquired businesses. Organically, consolidated beer volume declined 6.3% as lower volumes in Europe and the Americas were only partly offset by continued strong volume growth in Africa and, to a lesser extent, Asia-Pacific.

Heineken’s sales volume in Western Europe grew 43% to 9.5 mln ...More Info

Mexican brewer Grupo Modelo SAB said earlier this week that its net profit fell in the first quarter on higher expenses, while sales and operating profit grew from a year ago, Dow Jones reported on April, 21.

In a filing with the Mexican stock exchange, Modelo said net profit was 3.02 billion pesos ($213 million), compared with MXN3.25 billion in the first quarter of 2008.

Net profit excluding minority interests was MXN1.78 billion, down 14% from a year ago, Modelo said.

Sales in the quarter rose to MXN16.97 billion from MXN16.16 billion, and operating profit was MXN4.52 billion, compared with MXN4.44 billion a year ago.

The company reported an increase in expenses on severance payments for laid-off workers, higher taxes and an increase in worker profit-sharing.

Modelo, which makes top U.S. import beer Corona, said its Mexican sales rose 1.3% to 8.3 million hectolitres, with a 17% rise in sales of imported beers and 0.9% rise in domestic brands.

Modelo said it raised domestic prices at the end of March in line with expected inflation.

Export sales volume fell 6.5% to 3.1 million hectolitres as a result of the global economic downturn.

Earnings before interest, taxes, depreciation and amortization, or EBITDA, rose ...More Info

Belgian antitrust authorities will examine whether brewing giant Anheuser-Busch InBev NV is using its dominant position in the beer market to wrestle unfair deals from its suppliers, Belgium's economics minister was quoted as saying by the Wall Street Journal on April, 20.

Belgian Economics Minister Vincent Van Quickenborne said in an interview that he asked the Belgian antitrust authority on April, 18 to begin an informal investigation, which could take weeks or months.

He said the Belgian investigators also planned to contact their counterparts at the European Commission on April, 20.

"This could be of wider significance than the Belgian market," Mr. Van Quickenborne said.

AB InBev, which is based in Belgium and whose brands include Budweiser and Stella Artois and dozens of others, said it couldn't comment on the probe because it hasn't received any formal communication from the Belgian government.

"AB InBev always respects local laws and regulations as they apply and always respects its contractual obligations," the brewer said in a statement.

The investigation will focus initially on AB InBev’s relationship with its malt suppliers, Mr. Van Quickenborne said.

His comments come days after The Wall Street Journal reported that AB InBev is pressuring its suppliers with new purchasing practices, including a new policy ...More Info

Carlsberg Group’s Norwegian subsidiary, Ringnes AS, has signed a Letter of Intent to sell the brewery in Arendal to a group of local investors, the Danish brewer announced on April, 17.

Ringnes will keep a 20% share in the company. A number of terms and conditions are to be clarified before the final agreement can be signed, Carlsberg said.

Arendal has 145 employees and is one of three breweries in Ringnes, which has a total of 1,550 employees and a market share in Norway of around 55%.

Ringnes has earlier made it clear that the Arendal brewery does not fit into future production structure in Ringnes, and various structural solutions have been considered. One of these has been a sale of the brewery to local investors.

The sale of Arendal will increase the efficiency of Ringnes’ production structure, Carlsberg said.

Hong Kong-based Kingway Brewery Holdings Limited announced on April, 17 its final results for the year ended 31 December 2008.

The company’s beer sales volume fell 13.4% to 641 thousand tonnes over the reporting period as compared to the year ended 31 December 2007.

Kingway’s gross profit declined 42.5% to HK$292.34 mln, loss for the year grew 69.3% and basic loss per share increased by 53.3% last year. EBITDA dropped 4.7% to HK$192.06 mln.

“The Group recorded a loss of HK$39.91 million for the year ended 31 December 2008 as compared with a loss of HK$23.57 million last year. The worsened results for the year were mainly attributable to (1) the decrease in the Group’s sales volume; (2) the rise in production costs as a result of increase in prices of raw materials and unit fixed costs; and (3) the increase in administration expenses following the full-year operation of the brewery plants in Xian and in Chengdu and the commencement of operation in 2008 of the new brewery plant in Foshan, in addition to the increase in finance costs,” LI Wenyue, Kingway’s Chairman, commented.

Year 2008 was a relatively difficult year for the Group in the following aspects:

• The Group’s overall beer consumption in Guangdong ...More Info

Canada’s beer and liquor stores and agencies sold C$18.8 billion worth of alcoholic beverages during the year ending March 31, 2008, up 4.3% from the previous year, Statistics Canada communicated on April, 20.

The growth in dollar value reflected a combination of three factors. These were: increased sales of imported spirits, wine and beer compared with domestic products; a 1.4% increase in the population aged 15 and over; and a 1.8% average increase in alcoholic beverage prices during the fiscal year.

Beer stores and agencies sold C$8.6 billion worth of beer in 2007/2008, up 2.4% from the previous year. Ontario, Alberta and British Columbia were the largest contributors to this growth.

Beer remained by far Canada’s most popular alcoholic beverage in terms of both volume and dollar value, although its market share declined.

In 1993, beer accounted for 53% of dollar sales, spirits 29% and wine 18%. By 2008, beer's share had declined to 46%, while spirits had slipped to 25%. In contrast, wine had captured 29% of the market.

In terms of volume, Canadians bought 2.3 billion litres of beer, virtually unchanged from the previous year. On a per capita basis, beer sales have declined 27% from their peak of 115 litres in ...More Info

Danish brewer Carlsberg announced on April, 22 to the Shanghai Stock Exchange that it acquires 41% interest of Xinjiang Lanjian Jianiang Investment Co., Ltd (Investment Company) thereby increasing its stake to 89.3%.

The Investment Company is the major shareholder in Xinjiang Hops, which is Carlsberg's partner in Wusu Brewery Group in Xinjiang Autonomous Region the north-western part of China.

Wusu Brewery Group is one of the most important Carlsberg investments in Western China. With 9 breweries and sales of more than 3 mln hl of beer in 2008 Wusu Brewery Group is market leader in Xinjiang.

At the same time the Investment Company has reduced its shareholding in Xinjiang Hops from 41% to 29.9%.

As a consequence of the transaction, Carlsberg’s indirect ownership of Wusu Brewey Group increased by 3.4% to 13.4%. Thus, Carlsberg now owns directly/indirectly 63.4% of Wusu Brewery Group.

Following the transaction Carlsberg will consolidate the Wusu Brewery Group, the Danish company said.

The transaction is subject to approval from authorities, including Ministry of Commerce.

The Malaysian unit of Danish brewer Carlsberg is taking advantage of the current economic downturn to hunt for an acquisition target in Asia, the head of the unit was quoted as saying by The Guardian on April, 21.

“We are at the stage of doing analysis on certain opportunities. The board has given us a time frame to identify some opportunities,” said Soren Jensen, managing director of Carlsberg Brewery Malaysia.

The brewer had interest-bearing cash of about RM227 million Malaysian as of end-2008, and is unafraid of gearing up over and above that cash position to acquire a suitable target, he said.

Jensen declined to discuss specific acquisition targets, but said the brewer is not ruling out Malaysian companies, or one outside the alcoholic beverage industry.

Carlsberg surprised its investors in February when it decided not to pay a special dividend for 2008, preferring instead to conserve cash for potential acquisitions.

The brewer is targeting high single-digit revenue and operating profit growth for this year, Jensen said, although raw ingredient costs are expected to stay high.

"We are definitely budgeting for a revenue and profit increase this year but whether we can achieve that remains to be seen," Jensen said.

Last year, the brewer faced high ...More Info

Chile's largest brewer, CCU, plans to invest around $70 million in 2009, half the level of the previous year, as the global economic crisis saps demand and the need for increased capacity, Reuters reported on April, 20.

"We are going to invest less than we invested in 2008, around $70 million, when last year we invested around twice that figure," Chief Executive Patricio Jottar told reporters after a shareholder meeting.

"The investment is basically in packaging, in execution at the point of sale, reducing costs and spending and meeting environmental norms," he added. "In a scenario in which it is harder to make volumes grow due to the international crisis, we do not today need to make investments in capacity."

CCU, or Compania Cervecerias Unidas SA, said this month its sales volume rose 3.5 percent in the first quarter from a year earlier, compared with a 7.5 percent year-on-year increase in the fourth quarter of 2008.

Argentina, which accounts for about a quarter of consolidated volumes, saw a 31.5 percent jump in beer sales during the period, CCU said.

The company reported a 10.6 percent rise in year-on-year sales volume in 2008.

CCU placed around $182 million worth of bonds earlier this month to refinance debt ...More Info

Three private equity houses - Affinity Equity Partners, Kohlberg Kravis Roberts and MBK Partners - have made final offers for AB InBev's Oriental Brewery (OB), an official of the beer maker was quoted as saying by Reuters on April, 21.

The Belgium-based owner of Oriental Brewery had accepted the offers on April, 17, which it has valued at more than $2 billion, as part of an effort to sell non-core assets and to repay debt.

"It was only the three private equity funds that participated in the sale," the official with direct knowledge of the sale process said.

InBev is aiming to close the deal by later this week, he said, asking not to be named because he was not authorised to speak to media on that matter.

The three private equity firms are being advised by Goldman Sachs, Citigroup and Morgan Stanley, and are scurrying to secure financial backers from global and South Korean banks, Reuters Basis Point reported.

South Korean retail giant Lotte Group confirmed this week it had not handed in a final offer for OB because of pricing and other reasons.

Lotte had been seen as a front-runner to buy OB, given its financial muscle and determination to start a beer business, ...More Info

Red Stripe Jamaica will take command of Diageo's beer market within the hemisphere, but the company is saying not much will change in the logistics for the manufacturing or brewing and distribution of the English company's brands, the Gleaner posted on April, 22.

Red Stripe thus will obtain a 40 per cent command of the beer market in the Northern Latin America and Caribbean (NLAC) region in which Jamaica will fall as of July 1, under a regionwide restructuring exercise that Diageo has been engineering since the start of calendar 2009, the company claims.

The NLAC group brings Jamaica and CAPEC, which stands for the Central America free trade zone, Ecuador and Caribbean, under one umbrella. Mark McKenzie, who now answers to London, will report to the general manager of the NLAC region.

Noel DaCosta, who is both the corporate relations director of Diageo's CAPEC region and sits on the board of Red Stripe Jamaica as a non-executive director, said Jamaica would be in charge of developing the markets for Guinness and Red Stripe beer, as well as Dragon Stout.

All marketing contracts will be handled from Jamaica.

The beers will still be manufactured at different plants in the region. DaCosta said the main changes ...More Info

The global financial crisis will not dent demand for malted barley in Asia, Joe White Maltings general manager Gary Hughes was quoted as saying by the Weekly Times Now on April, 20.

According to the head of Australia's biggest malting company, demand for malted barley had grown 5-9 per cent over the past three years.

However, he said there had been some "settling" since the global financial crisis began.

"Certainly, we've seen some settling in South East Asia and north Asian markets," Mr Hughes said.

"But we do not expect it to go backwards."

Mr Hughes said he expected the market to continue growing when the global financial situation improved.

"There's been a steady increase during the past five years and we expect it to pick up again in the future," he said.

Mr Hughes said the malted barley was going into local and premium beer production in Asia.

"Beer consumption is directly linked to income per capita," Mr Hughes said.

"If people earn money above and beyond subsistence living, then they might be bigger beer drinkers."

Joe White Maltings, a subsidiary of ABB, will soon begin work on a new malthouse near Sydney, to meet burgeoning growth in Asia.

The site at Minto will include a 110,000-tonne malting plant and ...More Info

The Maltsters Association of Great Britain (MAGB) posted on April, 15 the final barley purchases made by Maltsters in England and Scotland from the 2008 Crop.

Total malting barley purchases amounted last year to 1,941,576 tonnes. Malting barley of English origin accounted for 56.6%, Scottish barley accounted for 43.4% of total bought.

Total barley imports as recorded from MAGB members are estimated at 18,142 tonnes.

Anheuser-Busch InBev, the Belgium-based world’s largest brewer, is buying less of a special kind of German hop used to make Budweiser, St. Louis Today posted on April, 17.

The company says the move is just an adjustment to account for a large load of the hops in the company’s inventory. The Budweiser recipe, it said, will not change.

Hops are the “spice” of beer, and give beers their characteristic bitterness.

The aroma hop in question, known as Hallertauer, is one of the most expensive varieties because its yields are low.

According to a report by Dow Jones, AB InBev this year offered to buy out contracts it has with hop farmers in Germany’s Hallertau, the world’s biggest hop-growing region, with the aim of reducing its purchases of the hop by two-thirds.

The crucial point, according to the brewer, is that the company already has enough of the hop variety to meet the needs of Budweiser, and that the beer’s taste will remain the same, Pete Kraemer, vice president of supply, said.

When growers plant Hallertauer hop plants, it takes three years before they get a hop. That means the planning for hops is long-term. AB InBev says it is trying to shift its purchasing to ...More Info

Masaaki Yano, Werner Back and Martin Krottenthaler

Abstract:
J. Inst. Brew. 114(4), 357–364, 2008 There is a vast repository of knowledge regarding improving beer taste stability via wort boiling. However, as far as we are aware, there are few reports dealing with taste stability improvement in terms of quality characteristics by boiling, under proper conditions, the first wort and second worts separately. In this study, more than 50 brews in a pilot scale brewing facility were conducted to investigate suitable boiling conditions for first and second worts. When the second wort (i.e., the last 10% of the total filtered wort) was kept under a low heat load atmosphere (78°C), casted to the boiling first wort, and then re-boiled for 10 min, the produced beer exhibited no significant differences compared to that of the general beer in terms of taste stability. However, when an adsorbent (bentonite, silica gel, activated carbon or PVPP) was individually added to the second wort and the same boiling procedure was performed, the oxidized flavour of the forced aged beer, treated with activated carbon, significantly decreased, compared to that of the general brew (level of significance alpha = 0.01). The data from the chemical analysis and fermentation behavior are presented. Key words: Activated carbon, adsorbent, brewing, flavour stability, heat load, second wort, wort boiling. Load full article, 7 pages, 682 Kb, PDF file