Brazilian company pulls out of Heineken profits

Dutch brewer Heineken eased profit forecasts for the year, thin margins in its growing Brazilian market and unfavorable currency movements erasing part of its half-year results . Shares fell 5 percent in early trading.

Heineken reported 4% year-over-year revenue growth for the first six months of 2018 as sales increased in all regions and volumes increased 7.5%. But the company said operating profit fell by 3 percent and profit margins were reduced, as a result of the consolidation of Brazil's Kirin arm in Brazil, unfavorable currency effects and rising foreign exchange rates. input costs.

"On the whole of the year, given the strong acceleration of our activity in Brazil with margins still below the group average and the negative impact of currencies, we expect a decline in operating margin of about 20bp "-François van Boxmeer.

Heineken bought Kirin Brazil for $ 700 million in 2017, which allows him to challenge his rival Anheuser-Busch InBev in his biggest market. However, the group warned in February that its recovery plan for the company, which had experienced difficulties, could weigh on the profits of the year.

In his forecast for the year, Heineken said economic conditions would remain volatile. Mr van Boxmeer said the group expects further growth in its turnover and operating profits, noting that the European market was "back to growth in the second Heineken realized a series of investments over the last few months, including at the Beavertown Brewery in London and the troubled pubs market in the UK.