With the possibility of a slower economic recovery in the Asia-Pacific region mitigated by better resilience among beer drinkers in Europe, Heineken kept its prediction for profit growth in 2023.

The second-largest brewer in the world anticipates a mid- to high-single-digit percentage improvement in operational profit this year.

“We see signals of a relatively resilient Europe and risks of slower economic growth in Asia Pacific, thus performance across markets may be different than anticipated,” Heineken said.

The Dutch brewer announced a first-quarter beer sales decrease that was higher than anticipated on Wednesday, with particularly significant declines in key countries Nigeria and Vietnam. However, price increases and some customer switching to more costly beers resulted in revenue growth that was in line with market expectations.

The brewer, whose eponymous brand is the best-selling beer in Europe, claimed that consumer demand in Europe and the Americas was outperforming expectations, but that performance in Asia Pacific and the region that includes Africa was “disappointing.”

Overall beer volume decreased by 3.0% in the first quarter, which was less than the poll’s mean prediction of a 1.9% reduction.

One of the best performers in the FTSEurofirst 300, Heineken shares were up 2.5% at 102.40 euros in early trading.

After a strong post-COVID rebound, the Dutch company, whose brands include Tiger and Sol, claimed it had raised stock levels ahead of the New Year in Vietnam, one of its main markets, but momentum slowed due to the country’s economic slowdown.

Volumes declined significantly in Nigeria, another important market for Heineken, as a result of the switchover to new banknotes, which left many consumers cash-strapped. Heineken anticipated that when the life of the old notes was prolonged, the issue would get better.

In line with forecasts, revenue before extraordinary items increased by 8.9% to 6.38 billion euros ($6.99 billion).

(Adapted from USNews.com)