Fridge into territory where beer brands normally couldn't go. First results look very promising. It's certainly refreshing our conversation today. Let's get into the main questions. I think one of the issues that we saw around the half-year results was this real renewed focus on volume for investors, which I think is coming from this concern around structural or cyclical changes in the alcohol industry. Do you think there's any evidence for this structural weakness? Do you think the main reasons for volume declines are due to cyclical factors? It's a very important question. I know it's on a lot of people's minds and also on our minds because in the end of the day, our algorithm as a beer company is really low single-digit volume growth, mid-single-digit revenue, and mid to high single-digit operating profit. That is the algorithm that works and that we need to make sure that we reestablish. I do think if you look at the wider world, there is a lot of simultaneous crises, a lot of conflicting signals on the economy at large, on staples in general, but also on the category. The way we think about it in the company is to really differentiate between the short term and the long term. In the long term, we remain very confident on the long-term growth prospects. If you disaggregate that to emerging markets and developed markets, we really see continued evidence that in emerging markets, the old fundamental drivers of population growth, urbanization, middle-class growth, GDP capita still works. You see it at play today in India, where we're growing our business mid to high single digit. You see even countries that go through a crisis like Vietnam two years ago, the market is growing again. We're up high single digit at the half-year mark. Ethiopia, also a market that has had an economic crisis, when you come out of it, high single-digit growth. Our footprint is highly skewed to these important emerging markets. We really believe that there is long-term consistent growth to be had in those markets. We are more cautious than we were in the past. We're really kind of trimming the portfolio, focusing on big markets with strong positions, and maybe letting go of some of the smaller or less strong positions. We announced last week that we're exiting Sierra Leone, which is another country in a long list. That is one part of the answer. We believe that those drivers are still there. In the developed markets, it's important to disaggregate between North America and Europe. In Europe, there's one fundamental difference, which is the Mediterranean region, where you have a lot of wine-centric countries, where even in a scenario of per capita alcohol going down, beer is still growing and has been growing. Those are countries like Italy, France, Spain, Portugal, Greece, Croatia, Switzerland, where you have a long-term growth momentum still in place. Even year to date this year, probably European market category is down in the low single digit. A country like France is up, Portugal is up, Italy, Spain broadly flat. That is a very important part of the developed market footprint that we have that we are excited about. Northern Europe, a bit more challenging. The U.S. is a little bit a case in point, I would say. Overall, mid-long term, we are very confident in the growthiness of the category, and particularly our footprint, which skews emerging markets, skews Mediterranean. In the short term, there's a lot of volatility. You also need to disaggregate it because it's not one thing affecting everything. Our APAC business is doing very well year to date. Our Africa-Middle East business is doing very well. Europe and Americas is a little bit more challenged. Europe, we believe it's really a factor of affordability. The category took over 30% pricing in a three-year time frame. We really believe the consumer is struggling to catch up. We know. It's also important that we keep pricing models to kind of restore the price-value equation for consumers. We believe that is what is, you know, dampening short-term demand. Last year, by the way, our volume was flat to up in Europe. It's really kind of softening a little bit now. In the Americas, there's a big difference between the U.S., again, being a case in point. The key markets like Mexico, Brazil have been very good for us the last four or five years, even during COVID and everything that's happened. We have had consistent growth coming out of those markets. Mexico is always a bit more moderate. We had, you know, low single-digit growth in the first half, pretty good. We are already cautious at the half-year results in August that we were seeing softer exit rates. That has persisted in the third quarter, where we saw the market dropping to a decline. We think it's very much incidental and related to the tensions on, you know, that there's no trade deal yet, the uncertainty, the remittances. The same in Brazil, where we also saw the market decelerate. Again, we believe cyclical and really related to the ongoing negotiations that's creating uncertainty. Also in both, there were big weather events that affected it. With hindsight, we're happy that we called that out as a word of caution. We believe the short term, we were right on that caution. That's something to be expected between now and year-end. Mid-long term, we remain very confident. OK, you run through a number of the markets, which I'm sure we'll go into a bit more detail in later on in the conversation. Let's just talk about this year. You've delivered towards the higher end of the 48% EBIT guidance. What are you worried about in the second half? What could make you end up at the higher end of the range or the lower end of the range? Yeah. Last year, we were happy with our performance. We had volume growth in all four regions, mid-single-digit revenue. We had over 8% operating profit growth. First half, solid performance, sequential improvements. Our second quarter volume was almost flat, decent revenue, good operating profits at 7.4%. We were deliberate in being cautious on the outlook as we were seeing those exit rates in Brazil and Mexico. We continue to be confident on APAC and the Americas region. We do expect low single-digit decline in Europe, which is a step up from the mid-single-digit decline, really driven by those retail events that are now behind us. The softness we're seeing in Mexico, Brazil. We are focusing on what we can control, which is execution in markets. Market share performance has been good. We're getting better and better at productivity, and that's creating self-help. I think the grip on, you know, expecting the unexpected so that we can very quickly adapt to new realities has been going up. That's something that we have been working hard at. That's why we remain very confident that we will deliver within the 4% - 8% range on operating profits. OK, let's dive into a few of these markets, kicking off with the Americas. In Brazil, you've mentioned the weather issues. You've sort of talked about the weaker consumer environment. I wonder if you can go into a bit more detail. What's really causing that weaker consumer environment? Is that something you expect to persist throughout the medium term? No, but please allow me to first state, the Brazilian market is incredibly important. Over the last 5- 10 years, the business has done extremely well. This is a business that we have been investing in for 30 years. Until 2017, we were not making money. We had a beautiful Heineken brand, but we lacked skill. We did the Kirin Brazil acquisition. In 2020, we did the agreement partnership with the Coca-Cola bottling system, creating a dual route to market. We launched the Amstel brand, and that has really unlocked big value creation over the last four or five years, where it's now a top three profit pool for Heineken globally, on the back of structural brand power on Heineken and Amstel and market share gains, all the way up to last year. This year has been a bit more volatile. We had a destocking in Q1. Q2 was actually good, but it was partly driven by taking the pricing a bit later than we did last year. We're seeing the deceleration triggered by weather, and we believe the consumer confidence being affected by those ongoing tariff discussions. We foresee softness in the second half of the year. We believe it's cyclical. Also, if you look over the last 5, 10, 15 years, the Brazilian market has always been quite resilient. That's why we also keep investing in the market. It's not just, you know, a marketing story. We are opening up the Passos brewery later this year. Even at flattish volume in the short term, if you believe that from a logistical optimization, tax benefit point of view, that still makes a lot of sense. Either way, that is beneficial to our footprint. Mid-long term, very bullish. In the short term, we're deliberately cautious and agile in navigating a little bit of this turbulence. Since you bought the Kirin business in 2017, I think the Brazilian market has seen a profound amount of premiumization, and your sales have certainly benefited from that as well. You mentioned there's a new brewery coming online late this year. Do you see this premiumization continuing at the same pace? We were growing the Heineken brand 20% year after year. At some point, that is going to slow down as it should, just the absolute scale of the brand. It's by far our number one Heineken market globally. Very importantly, even with all the kind of twists and turns today, the premium segment continuously grows. For us, though, the Amstel brand has been very important too because historically, the legacy business of Kaiser and of Keurig was economy. We went from 80% economy to now the inverse, 80% Heineken and Amstel, and only 20% of the residual economy. In that sense, we feel we have a very strong portfolio. We have some craft brands, super premium brands. The Eisenbahn brand, which is playing in affordable premium, is growing nicely this year. It is really making sure that Heineken and Amstel stay healthy and growthy and already make sure that we think of the next generational brands. Can we talk a little bit about pricing? I think your price increases this year are a bit later than some of the competition. I was wondering if you could talk around the rationale for that and some decision making there. We've seen price pressures from one of your key competitors within Brazil. I was wondering how that impacted your mainstream portfolio in particular and your ability to raise price within Brazil. Yeah, I think on that second part, I think you're referring to Petropolis F for the last 18 months or so. They've been quite assertive in the economy segment. We've chosen to not fully play along, and we have sacrificed some low margin economy volume as we have for the last decade because we wanted to deploy our capital, our capacity available behind Amstel. At the half-year mark, I think the Amstel brand was up high single- digit, so you know there's no impact there. Not too worried about it. Every year, we look a bit at what the optimal price moment is. As we had that destocking happening in Q1, we didn't want to follow immediately. It was the rational thing to do it over the summer. That was done in July and is fully effectuated. Okay. You've taken your distribution in-house for much of your Brazilian business. How do you continue to work with the Coca-Cola bottling system within Brazil? Yeah, so basically what we did in 2020 is that because of the combination of the Kaiser portfolio, the Kirin portfolio, and our own kind of global brands, there were simply too many brands for us to do justice to. The kind of arrangement and the partnership as it emerged in 2020 is that it was for us very important to get the Heineken and Amstel brands because the Coca-Cola bottling system had done an amazing job in the off trades. In the returnable pack and the on trade, it was underdeveloped because they were less focused on it. Building off the Kirin Brazil route to market, we could do a much better job. That has been instrumental these last five years in the success we've had. At the same time, they retained a lot of the older brands, including, for example, the Eisenbahn brand, which is growing nicely this year to also leverage their incredible route to market. You mentioned earlier that margins have improved significantly in Brazil. I think they're close to group average levels. Are there further to go with regard to margin expansion? Our long-term target was to get it here. I think for 10 years, we were getting questions on it. Right now, it's just making sure we find the right balance between the category health, overall volume growth, gross margins, et cetera. We don't have a particular destination other than making sure that in the aggregate, we create long-term value. Okay, let's move across to Mexico. There's been a lot of challenges with regard to weather, difficult comps, softening consumer environments. How have you navigated these challenges? Are you confident, as you ever were, that Mexico will be a key growth market for beer and for your brands? Yeah, Mexico, yeah, our most important market globally. The last five years were very challenging because of the OXXO mixing. We're actually very proud of how we're coming out. That was very well executed. Actually, our operating profit has grown considerably as we were converting low margin OXXO volume to a high margin SIG volume. When I left Mexico in 2018, we had 10,000 SIG stores. Today, we have 17,000. Having that system power with the retail chain has been extremely important. I think we're happy where we are coming out of the OXXO mixing, the strength of our broad portfolio, as well as our channel footprint with SIGs. As such, yeah, also the first six months of the year, performance was good. Again, we see some short-term softness in the market, which in the bigger scheme of things is normal and something that we're not too worried about navigating. It's just focus on execution, on the innovation, strengthening our brands, making sure that, yeah, we fight for market share and what have you. Mexico is always a bit more moderate than Brazil. With Brazil, it always moves a bit more up and down. Brazil is always a bit more moderate in that sense. Okay, let's pivot across to Asia and look at Vietnam, which has been a pretty volatile market over the past few years. This year saw a big improvement. Is that really to do with consumer sentiment, or is that some of the changes that you've made within the markets? I think it's a combination of two. 2023 was a brutal year for the country, big economic crisis, real estate crisis, beer market declines. That affected us in a big way at that time. It was for the first time in 30 years that there was a volume decline. We really used last year to make big interventions in the business. We rebalanced between channels, between on and off. We rebalanced between segments, between premium and mainstream, within brands or segments like between Tiger and the Heineken brand. We addressed our supply chain aspects of our cost structure. I really believe that we're coming out of the crisis much stronger. What you see on the market after the decline of 2023, last year, first half declined, second half, the market was growing. Now, year to date, 2025, markets are consistently growing quarter after quarter, month after month, not just in the off trade now, also in the on trade. The market has proven very resilient. They were one of the first to cut a tariff deal with the U.S. government that I think has provided clarity and stability. Within the market, though, we are gaining a lot of market share across channels, across months, across quarters, and across against all our main competitors. We are the one now going share. We believe it's the consequence of the execution and strategy sharpening that we have done over the last 18 months because it's really driven not just by the way, brand Heineken is up another 50%. It's now our third largest market after Brazil and China. Our mainstream brands are now increasingly important too. Very proud with the step up in execution, the sharpening of the strategy, and yeah, impressed by the resilience of the Vietnamese economy. You mentioned there's a big focus on a mainstream portfolio within Vietnam. What's really driven that change? Is there the opportunity to see those consumers repremiumize into some of your more premium brands? I think it's the other way around. I think under our kind of drive, we overpremiumized the markets relative to its development stage. We always knew that one day that music would stop. That happened in 2023. We have been quick to adapt, and we see now brand Tiger stabilizing. Also, the low bitter variety, Tiger Crystal, was really growing very fast. Part of the volume went to mainstream. Actually, part of the Tiger volume went to Heineken. The Heineken brand more than doubled over the last two or three years. All in all, we're happy with where the portfolio sits between mainstream and premium. We have two, three brands in mainstream. We have two brands in premium, and we're basically playing against single brand competitors. That broad and breadth of the portfolio is giving us a lot of market share power. You didn't mention Heineken Silver, which I think has been one of the great successes of Vietnam. What's really driven that growth? Do you expect it to continue? The origin of Heineken Silver was Vietnam. I remember being the incoming Regional President at the time that the local team was arguing like, hey, we have the brand power. Our consumers love us, but they don't like the taste anymore. It was a huge debate, existential debate, like are we going to allow that kind of innovation? I think the fact that Ho Chi Minh City was so far away from Amsterdam that we got away with it at the time. We piloted it. It's incredible. It has completely transformed not just our brand momentum in Vietnam, but across the APAC region. For all the success of Heineken 00, and we're super proud of it, and we love the growth, we're selling more than double the amount of Silver. It's really driven by key markets like Vietnam, China. We're expanding in Taiwan, in India. Particularly with the Asian consumer, that taste profile seems to be resonating very well. Geographically within Vietnam, I think you've been more focused in the south of the country. Where do you see the future growth of the country geographically? We are growing in the north as well. We are less developed there. At some point, there was a concern that the center of gravity would be shifting. We don't see that right now in our volumes. We still feel it's pretty broad-based, where we do have a big market share upside in the north that we're kind of consistently building towards. If we pivot across to China, I think it's about 8% of profits for Heineken today. Your partnership with CR Beer appears to be delivering pretty strong growth for Heineken, about 20% or 30% growth rates recently. How long can you sustain these sorts of very strong levels of growth? First of all, incredibly happy with the partnership. It's now we entered our sixth year. We sold, from the top of my head, over 7 million hl Heineken last year. Indeed, it has become a, even though we don't consolidate, which is, by the way, frustrating because license volumes are going up so fast at Heineken that it would add another 5,200 basis points to our total sales volume if you would. By the way, we will start creating more visibility on that going forward. Even right now, at 7 million hl, year to date, brand Heineken is up 20% in China. We're only in 25% of the outlet footprint of CR Beer. We're never going to be in 100%. I like to believe there's still a lot of upside there. Very importantly, over the last one or two years, we have been able to create a second source of growth with the Amstel brand, which is now up 155% year to date. Very happy with China. We believe there's still a long runway to go. Indeed, at the net profit level, it's a top five, if not top three, operating company in terms of value creation. You mentioned you've got Heineken there. You've got Amstel there. What other brands are available in China today? What does the future portfolio look like? There are a bunch. To get the flywheel going, it needs to be a very clear, scalable proposition. It is not about getting as much. It is how many brands are you able to get in that multi-year flywheel. Right now, with Heineken and Amstel, we have enough runway to go. OK, let's move across to Europe. It was a huge focus over the recent results. You saw this big disruption from price negotiations that led to a delisting. I was wondering if you could just run us through what happened there. Are you seeing an increased focus from these buying groups, or was it simply just your turn this year to take the penny? Yeah, first of all, Europe is a consolidated retail landscape. It's incredibly important. Those partnerships with major retailers like Tesco, Carrefour, et cetera, are very important to us. We take that very seriously. You have the famous Advantage survey and score that kind of ranks the suppliers. We're consistently in the top three of retail partners across all staples. In the U.K., the most advanced market, we are number one. That is very important, that this is not transactional. These are strategic relations. Secondly, beer is special because beer is truly local. You don't have one big diaper plant selling to all of Europe. Then you get these debates, why do you have differentiated pricing? You have local cost structures. You have local legislation as an alcohol category. You have returnable packaging with reverse logistics. You have very low propensity of private label because beer is an emotional category. As such, beer has been less vulnerable than other staples. This year was a bit different because affordability coming out of the hyperinflation of the last year, affordability is a political theme. That has kind of dialed up a little bit the pressure as it should because we all are a bit concerned about how do we restore the price-value equation. One or two of the groups tried to leverage that to argue and ask for things that for us would be breaking very important principles. That's why we said no. It doesn't matter how long it takes. This is a compromise we can't make. We saw it through to the end. It's all settled by now. In one or two countries, it takes a bit longer than anticipated to refill the chain, but slowly but surely, we will. Underlying, we believe the market is in a low single-digit decline. We were mid-single digit because of that. For the second half, we do need to see that sequential improvement to low single-digit decline, which is not where we want to be because ultimately, we believe that Europe should be growing. Given this focus on volume growth that we've had recently, we've seen the capital consumption of alcohol in Europe decline over the past decade or so. Beer volumes have also struggled across many of the companies in Europe. Do you think that is something that can reverse over the medium term? Can we go back or get beer to growth within Europe? It's interesting to look at historical numbers. If you look to the period 2008- 2012, the great financial crisis hit Europe hard, big, steep volume declines. You saw stabilization, and actually, in the period 2015 - 2019, there was market growth. If you look to the decades, 2010 - 2019, it was flat with the last five years of growth. We do believe the markets can grow. I think we're kind of in a similar pattern that we're coming out of those crisis years with a lot of pressure on volume. We need to stabilize, and we need to all work hard to make sure it grows. What we like to say internally, as we are the leader of beer in the region, you're not just a category taker. Also, the decisions we make will determine the outcome. We need to shape the category. We need to invest in our brands, our segments, in developing new propositions, developing new locations to make sure that we stabilize and get back to growth like we did in the years leading up to COVID. In terms of cost savings, Europe has been a key area through a brewery consolidation. How does the footprint look now versus before the pandemic? What further changes do you still need to make? Yeah, on footprint, you mean supply chain footprint or brewery? Brewery design and your supply chain. We have announced and closed approximately 10 breweries, which were left over earlier. Those were difficult projects to execute, which we have. On the brewery footprint, I think we're getting to where we need to be. We still see huge opportunity on taking cost out. As much as I'm incredibly proud to represent Heineken and our OPCO-centric model, which is very entrepreneurial, very innovative, on the back office side of things, we were fragmented and therefore unnecessarily complex and costly. Some of that on OPCO by OPCO, we have been able to take out the last five years with our productivity program. We now see a whole next phase of productivity savings really on the transactional process side, whether it's finance, HR, procurement. We're really ramping up our regional capability centers. At the same meeting in Seville, Harold will speak more to that. I look forward to that trip to Brazil, to Seville, maybe not Brazil, maybe next year. Just getting onto Heineken 00, I think it's been a key region for growth in Europe. What's really driving the success of the non-alc space within beer? Are you confident that the non-alc beers are being accretive to the performance of the core brand? Yeah, I have said it before. Non-alcoholic beer has been around for decades. You had O'Doul's and Kaliber and Buckler and Clausthaler. There were basically three issues with the segment at the time. There was a taste barrier, a reputation quality barrier, and a social stigma barrier. When we designed Heineken 00 in 2016-2017, it was designed to address all three barriers. Through new technology, we cracked the taste barrier. I think it's well recognized that Heineken 00 was the first of a new generation of great tasting 00s. We deliberately played it on Heineken and not on a secondary brand, and we line priced it to the full alcohol version, sending a quality and a reputation signal, which right now is kind of obvious. At the time, nobody had a 00 variant on their core strategic brands. Heineken was the first to do it. That was a risky move, but that worked out well. It addressed that quality perception. We have been investing literally hundreds of millions to Formula One platform and what have you to destigmatize social consumption of 00. Rolling Stone magazine did a whole special on Heineken 00, giving us credit as shaping popular culture, making it socially acceptable to drink 00. Now, indeed, with an ultimate, we're kind of going to the next level where we're looking for new opportunities, new occasions, pushing into space where beer traditionally could not play because it's adult, it's natural, and premium. It gives us leverage points that we feel excited about. On the margin, on the accretive, first of all, Heineken 00 is maximum 25% cannibalization, 75% incremental. From a margin point of view, it's accretive because you have the benefit of the lower excise duties. To me, this is going to be 20 years of compounding. This is the opposite of Seltzer, which kind of shot up and went down. This is going to be low double-digit growth, 20 years. After 20 years, you suddenly look, hey, it's 10%, 20% of my category. You already see that in some European countries where it's crossing the 10% of total beer, like in Germany, the Netherlands, and Spain. This is a space where we have been the pioneer, the leader. By all means and purposes, we keep investing. Heineken 00 is obviously your key brand. You've got another number of non-alc brands on some of your other beer brands. Do you think there's a space in your portfolio for a non-alcoholic beer that's not associated to one of your beer brands? We've seen Athletic in the U.S. We've seen Lucky Saint in the U.K. Something like this, could that be useful to Heineken? It could be because also in some territories, the regulatory system is different for a native brand. Athletic has the benefit that they can do things that soft drinks can and that beer can't. Those are things that we're looking at for sure. Yeah. Let's just move across to Africa. We've only got a few minutes left. I think it's fair to say that the acquisition and integration of Distell perhaps didn't go as smoothly as it could have done. What lessons have you learned from that? What's the acquisition given you? How do you feel about the non-beer part of that portfolio? Yeah, so very important. We were standing at a crossroads where we had the Heineken brands, a single brewery in Sedibeng, a niche position, and no profits. Africa and Southern Africa being the key profit pool of the Africa-Middle East region, we had one shot at really scaling up and getting into a position of not being a niche player, but being a major player in the market and creating another Mexico, Brazil, if you like. As such, no regrets. We really feel this was the move to make. It has been tougher than anticipated. We announced on November 2021, and we closed on May 2023. Between those two dates, the world changed: inflation, war, the weighted average cost of capital going up. There was a little bit of a timing thing. There was an extended period where we were not allowed to speak with Distell from an antitrust point of view before closing, which created a competitive vulnerability. We underestimated in all candor the complexity of the reverse. Now, two years in, actually, we feel we're getting to completion on the integration. Very happy to see beer market share growth in the second quarter. The Amstel brand is really getting its mojo. The Wool Cider F&B category, the Savanna brand, the Bernini brand, very strong and more intuitive, more similar to how beer works. We're learning about the wine and spirits part, but that's a secondary part of the portfolio. Outside of South Africa, we're ahead of the business case: Namibia, Botswana, Zambia, Eastern Africa, where we're integrating the Heineken brand, which has always been there but didn't have a proper route to market, now combining with the spirits portfolio. All in all, we're now getting to a good place, and now we really need to unlock the value in South Africa. Outside of South Africa, you've got businesses in Nigeria and Ethiopia, which have seen historically some decent growth. Now inflation's slowing. Do you have more hope for volume growth in these two countries? Have you managed to materially improve the margins in these two countries? Yeah, so the currency crisis of the last 24 months in Nigeria, Egypt, Ethiopia are really unprecedented. The last time we saw that was in the 1980s. This was a big one. Those countries are taking a lot of tough medicine. You see, for example, Ethiopia has come out of hyperinflation. They're really getting their act together. In the meantime, we did the same. We really like Vietnam. We didn't waste the crisis. We really intervened on cost structures, pushing break-even points down, closing breweries, expanding portfolios, cleaning up portfolios. I do believe our companies are coming out stronger than they went in. We're gaining market share in Ethiopia. We're growing high single digits. Egypt, high single digit growth. Nigeria, financially very strong, volume a bit soft as the country is still struggling with the last bits of inflation. These are markets that we're unapologetically long on because big population, good growth fundamentals, and very strong leading market positions that under duress and out of necessity have really been cleaned up for the next couple of years. OK, we've done a good runaround of many parts of your business. Which part of Heineken do analysts, investors just not ask you the questions about that you really think we should? The thing that we don't speak a lot about is kind of the internal change that needs to happen to enable everything on the footprint, on the portfolio, on the top line. The company historically has been very fragmented, very complex, and with a non-competitive cost structure. We are doing a lot of work on harmonizing our operational processes and data and systems. It's a program called the DBB. It's not sexy. It doesn't sell beer in and by itself. It needs to be done, and it needs to be done well. In a world of AI application, it's actually fundamental because the AI value capture, you do need a good process and data foundation. There is a lot of organizational energy that goes into that. We're about halfway through that program, which then also enables that second wave of productivity savings on the strategic capability center. There is a lot happening there. In the end, I'd rather have the questions, I think, on the footprint and the brands and the innovations because long term, that is what truly matters. Thank you so much for joining us at the Barclays Conference. Thank you, so much.