Beer sales fall
Heineken to cut 8,000 jobs as it slumps to loss
The company will push its premium products
Heineken, whose UK headquarters is in Edinburgh, is to axe 8,000 jobs as part of a €2 billion three-year restructuring plan.
The company recorded a net loss of €204m in 2020, a 109% fall in profits from the year before.
Sales fell by 17% to €23 billion with bars and cafes closed in many countries, the company said.
Heineken announced the restructuring in October but gave no details at the time.
The job cuts will cost €420 million and the timing of restructuring “will vary depending on the specific circumstances of each of our local operations”, including a reduction of the personnel costs at the Amsterdam head-office by a run-rate of c.20% to be implemented at the end of the first quarter of 2021.
It is thought job losses among the 2,300-strong UK workforce will be limited to about 100. The company also owns the historic Caledonian Brewery in Edinburgh.
It aims to achieve its targets by redesigning its organisation to make it more efficient and effective, reduce the complexity and number of its products and identify its least effective spending.
The brewer of Europe’s top selling lager said in a statement that ongoing COVID-19 restrictions meant 2021 revenue, operating profit and operating profit margin would be below levels in 2019.
Heineken UK head office at Edinburgh Gyle
The brewer unveiled details of a strategic review and said its new “Evergreen” plan would boost income and raise margins.
The company said it will promoting its premium brands along with its zero-alcohol lager. It also aims to become the best digitally connected brewer to serve consumers increasingly looking for beer online.
It expects market conditions to improve gradually in 2021 and continue to improve into 2022, with a slow recovery of bars and restaurants in Europe.
It said it expected to achieve an operating profit margin before one-offs of 17% by 2023. That compared with 12.3% last year and 16.8% in 2019.