On-trade channel gains first increase since 2000

“Driven by a return of consumer confidence and spend” the on-trade recorded a growth in market share of 1% last year from 61% to 62% of the beer market, according to Heineken Ireland’s 2013 Performance Overview, just published.

2013 saw a positive shift in the on-trade rates with an increase in market share recorded for the channel for the first time since the turn of the millennium, it reports.
Despite this, beer market volumes declined by 3.2% last year compared with 2012 although HI reports that market values increased by 2.8% to €2.5 billion, up €50 million on 2012. This increase was primarily driven by the increased growth of the on-trade, reports the brewery.

The pub trade still dominates the beer market with a 62% share while the rate of decline in the off-trade sector for 2013 was 1% compared with 2012.

Heineken Ireland’s own portfolio of beers increased its value share of the market to over 46% of the lager segment, primarily driven by the Heineken brand itself.

In the on-trade, one in every two pints of lager consumed comes from the Heineken Ireland portfolio.

Lager remains the dominant and preferred beer of choice for the Irish consumer, retaining a market share of 65% of the total beer market with stout continuing to decline with a market share of 29%, reports Heineken Ireland.

“2013 has been another year of strong progress for Heineken Ireland which has seen us grow our market share in both volume and value terms in a beer market that experienced a decline of 3.2% in 2013,” commented Maggie Timoney, Heineken Ireland’s Chief Executive, “Our sustained, high-impact commercial programmes continue to deliver across our main brands and helped our company extend its leadership within the lager market.”

The Cork subsidiary of Heineken nv maintains that the outlook for the beer market remains fragile, describing last year’s 3.2% decline as “extremely significant”.

The company’s Outlook states, “Severe constraints on credit are still being imposed by the banking sector. This will certainly continue to make it difficult for the pub sector in 2014.

“Heineken Ireland sees no evidence of any serious efforts being made by both government and the banking sector to support the labour-intensive pub sector in this regard.

“Signs, however, do exist of some stabilisation of beer volumes within the overall pub sector, but with an off-trade sector recording a year-on-year decline in 2013, the beer market is in for some challenging years ahead,” concluded the brewery which employs 544 people and which has a turnover of €477 million.

Heineken nv, the parent company, reported full-year Group Operating Profit up 0.6% organically to €3.2 billion on Group revenues up 0.1% organically to €21.25 billion.

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