Heineken Q1 sales soar as drinkers return to bars

Dutch brewing giant Heineken reported a surge in beer sales during the first quarter driven by the easing of Covid restrictions as it maintained guidance on profit margins.

Beer volumes rose by 5.2% on a like-for-like basis year on year, topping the 3.5% average forecast in a company-compiled poll. Europe was a standout performer, rising 11.5%, with beer sales in bars and restaurants almost tripling.

Average income per litre rose by 18.3%, driven by direct price increases, consumers switching to more expensive beers and also returning to pubs and bars.

However, the company said Russia's unprovoked invasion of Ukraine had clouded the outlook for commodity markets.

"We expect mounting inflationary pressures to impact household disposable income and a consequent risk to beer consumption later in the year," Heineken said, adding that it faced rising costs, supply chain challenges and pressure from its decision to leave Russia.

It maintained its guidance of "stable to modest" improvement to its operating profit margin in 2022. The company in February said soaring inflation could hit sales, casting doubt on its plan to raise its operating margin to 17% in 2023.