0

HEINEKEN AmericasWhat’s Brewing Seminar

HEINEKEN strategy to win in Americas

New York 19 November 2015

1

Marc Busain

Region President Heineken Americas

Managing Director Cuauhtémoc Moctezuma

Heineken Mexico

Managing Director Positions in Burundi, Egypt and France

Finance Manager, Heineken Netherlands Supply

Started with HEINEKEN, Finance Manager

Democratic Republic of Congo

2015

2011

2003

2001

1996

2

AgendaHEINEKEN strategy to win in Americas

Revisiting the positive Americas region characteristics

HEINEKEN profile in Americas and contribution to HEINEKEN group

Regional strategic priorities

Key markets Update: Mexico US Brazil Canada, Caribbean and Export

1

2

3

4

5 Summary

3

1. Diverse markets with untapped growth potential

Source: Canadean 2014.

With Beer Per capita consumption varied and low relative to more developed regions

-

15

30

45

60

75

Per Capita Beer Consumption (2014)

Western Europe

HEINEKEN countries

Non HEINEKEN countries

4

1. Favourable population dynamics

Source: UN World Population Prospects, Canadean.

Region benefits from a younger average population base

73% 71% 70%67%

63% 62% 62% 62% 62%60% 59% 59%

56% 56% 56% 56% 54%51%

48%46%

43%

% population under the age of 35 (2015 forecast)

Europe average 41%

12 6 10 7 7 5 6 3 7 8 4 1 6 4 4 4 6 4 -5 4 5Population growth

2015F-2020F

in percentages

HEINEKEN countries

Non HEINEKEN countries

5

1. Compelling Premium beer opportunityWith Premium beer share of market still relatively low in a number of countries

35%34%

23%

16% 16% 15%

11% 10%9% 8% 8% 7%

5% 5%

2%

Panama USA Chile Canada Peru Ecuador Costa Rica Argentina Brazil Guatemala Honduras Venezuela Mexico El Salvador Nicaragua

LATAM average 15%

Europe average 31%

% PS of total beer market 2014

3 231 7 20 14 7 2 18 143 2 2 22 69 1 1Total beer

market size

2014 (MHL)

Source: Canadean 2014.Premium beer segment defined by Canadeanas >= 115 price index.

HEINEKEN countries

Non HEINEKEN countries

6

1. Resulting in favourable regional volume expectations

Key Markets Beer consumption (mhl)

Source: Canadean. *Andean includes Venezuela, Peru, Colombia, Equador.

0

200

400

600

2010 2014 2020F

Favourable demographics with positive population growth and age profile

Positive beer market fundamentals with low beer per capita consumption and Premium segment share of market relatively low

Significant income growth in key developing markets

Premium expansion in mature markets where HEINEKEN Americas is well positioned to

capture growth

CAGR

+0.3%

+2.7%

+1.7%

+2.8%

+1.7%

-2.4%

+0.2%

CAGR

+1.8%

+1.7%

+2.6%

+3.1%

+2.4%

-1.3%

+1.4%

Argentina & Chile

Brazil

Andean*

Other LATAM

Mexico

Canada

USA

7

8.9mhl

29.5mhl

28.7% 24.9%

2. Americas is an important contributor to HEINEKEN’s business

Source: HEINEKEN Annual Report 2014.

Group beer volume Heineken® Consolidated EBIT

8Source: Nielsen and CanadeanPremium beer segment defined by Canadean as >= 115 price index.

A collection of highly diverse markets and business models

2. HEINEKEN Americas Footprint

9 Operating Companies

6 Joint Ventures/ Associates40+ Export Markets

# HEINEKEN Premium market share

#1

Central America & Caribbean

#1

Costa Rica

#2

Panama

#1

Haiti

#1

Puerto Rico

#1

Jamaica

#1

French West Indies

#1

St. lucia

#1

Suriname

#1

Bahamas

#2

Canada

#2

United States

#2

Mexico

#1

Chile

#2

Argentina

#2

Brazil

9

Mexico USA Brazil Canada Chile Argentina Panama Haiti Bahamas St Lucia Jamaica

INTERNATIONAL

AND DOMESTIC

PREMIUM

Heineken®

StrongbowBohemiaAffligem

Heineken®

Amstel LightStrongbowLagunitas2

Dos EquisRed Stripe Newcastle

Heineken®

SolDesperados

Xingu

Heineken®

StrongbowDos EquisNewcastle

Heineken®

SolRoyal Guard

Heineken®

AmstelImperial2

Budweiser2

Heineken®

Guinness1

Heineken®

Guinness1

Heineken®

Guinness1

Heineken®

StrongbowDesperadosGuinness1

Heineken®

Guinness1

UPPER MAINSTREAM &

MAINSTREAM

Coors1

Dos EquisSol

IndioTecate

TecateCristal2

Escudo2 Schneider2 PanamaSoberana

Prestige Kalik PitonRed Stripe

Dragon

(LOWER) MAINSTREAMSuperior

Carta BlancaKloster

KaiserBavaria

Palermo2

Bieckert2 EclipseMalta

Talawah

2. Americas regional brand overview

1 Represents Licensed brands.2 Represent Partner brands.Heineken® may include Heineken Light.

A premium led brand portfolio complemented by strong mainstream brands

10

2. Expanding our Footprint in the Craft Segment… and the Caribbean

* Source: Nielsen

Acquired 50% shareholding in Lagunitas

5th largest craft brewer in the US by volume

Lagunitas IPA is largest IPA Brand by volume in the US* and c.56% volume

IPA segment, fastest growing category in craft

Will continue to be run by current management

Current volume predominantly in the US

Exciting opportunity to expand throughHEINEKEN’s global platform

Acquired Diageo’s 57% stake in D&G taking ownership to 73% MTO launched 6 November for remaining shares

D&G leading share in Jamaican beer market

Red Stripe c.40% volume of D&G brand portfolio and the #1 brand in Jamaica

Red Stripe c.50% in Jamaica, with large international markets including UK, Canada and US

Further international potential given heritage and distinctive attributes

Strategic asset within key growth market

11

2010 2014

Group beer volume

2. With Topline driving solid EBIT growth

In mhl

CAGR +4.8%

2010 2014

Consolidated revenueIn €m

CAGR +7.8%

2010 2014

Consolidated EBIT (beia)In €m

CAGR +8.8%

12

WIN IN PREMIUM

LED BY HEINEKEN ®

LEAD BY COOL MARKETING

AND INNOVATION

SHAPE THE CIDER

CATEGORY

DRIVE END2END

PRODUCTIVITY

BE COMMERCIALLY

ASSERTIVE

BREWING A BETTERWORLD

3. Regional strategic priorities

Global strategy to exploit region specific opportunities.

Defined strategy to capture regional specific opportunities

1 2 3 4 5 6

13

'89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 14

Win in premium led by Heineken®

* Note: L52W ending 10/03/2015

Gaining momentum with Heineken® in the US, Mexico and in Brazil

Brazil Success Story

HEINEKEN

Share of Premium

+48% 4Y CAGR

Heineken® turnaround in US

Volume

development

in khl

Yearly Growth

6%

10%

13%14%

17%

1

2010 2014

Mexico: Heineken®

in mhl

CAGR +52%

2010 201420112009 20132007 20122008 L52W 2015*

Back to positive growth in 2015

14

Heineken Light – ‘best tasting light beer in the US’Video

1

15

Lead by Cool marketing and innovationMarketing is driving consumer pull for our brands and innovations delivering sustainable top line growth

Cool Marketing Innovation Rate

Americas has almost tripled revenue from innovations over the last 2 years (to c.6%)

Leveraging global innovation successes eg Radler

Focus on margin enhancing products which support top line ambitions

2

16

Shape the Cider Category Focus on Strongbow in the US is rapidly gaining momentum, driving double digit volume growth

HUSA and Canada account for 91% of volume. Nielsen Grocery through 01/03/2015, Brand Franchise.

Distribution rights transfered from Vermont Hard Cider Company (C&C) to in house from 1 January 2013

Fastest growing cider brand in the US

#2 market share

Depletions up ytd September over 40%

Best Tasting hard Cider

Strong sampling increasing brand awareness

Flavours addressing consumer demand for variety and choice

3.4%

7%

Beginning of theyear

End of year

2014 % Volume Share

3

17

StrongbowVideo

3

18

Driving E2E ProductivityTo deliver increased efficiencies at the business

Productivity Improvement

Ongoing productivity gains and cost saving initiatives have improved costs as % of revenue.

Main cost saving initiatives generated over €234m savings (excluding IPO synergies) in the course of three years (2011-2014):

Supply Chain: FTE headcount optimization, Consumer value Engineering, Energy and Electricity Savings, Network Optimization

Commerce: FTE headcount efficiencies, Retail operation improvement in Mexico, Sponsorship improvements, Agency Fees Savings

Support: FTE headcount optimization

Production FTE’sProductivity per mhl / FTE

4

2,000

4,000

6,000

5

10

15

2012 2013 2014 2015YTD

19

Be Commercially AssertiveTo drive excellence in outlet execution

Draft Systems Right Channels and Customers

Excellent Outlet Execution

5

20

Brewing a Better WorldSustainability is embedded in HEINEKEN Americas strategy

Safety First Responsible Consumption

Sustainability Sustainable Sourcing

Cool@work & alcohol policy

Extending safety from brewery to sales & distribution including road safety

Company wide Safety Strategy (the 5C’s) and 12 Life Saving Rules

Deliver on global industry commitments

10% media spend target on Enjoy Heineken® responsibly

Eco-efficiency: Tangible targets for energy and water reduction

Water stewardship initiatives in Mexico with local community for brewers for sustainable water supply in scarce areas

Haiti sorghum projects with Clinton initiative to stimulate local farmers harvest

Ongoing compliance to Supplier Code Procedure

6

21

4. HEINEKEN MexicoAttractive growth prospect for beer

Main Brands

6 Breweries 27.8 mhl beer 41.5% SOM #2 Position

Facts HEINEKEN’s largest market

Positive underlying market fundamentals, including population growth, urbanisation, growing middle class

Beer the alcoholic beverage of choice (at 94%)

Exciting premium segment potential, still underpenetrated

Applying a targeted regional strategy to drive growth

OXXO partnership and development of own stores (Six) strengthening commercial execution and maximising volume and value

22

4. HEINEKEN Mexico

1 Includes domestic beer operations only2 Includes domestic beer and export operations

Strong Topline growth since the acquisition

Strong national portfolio withrepresentation across varied price points

Strategy continuing to deliver impressive growth

2010 2014

Revenue1

2010-2014€M

CAGR +6%

2010 2014

Operating profit (beia)1

2010-2014€M

CAGR +20%

2010 2014

20.4%

Operating profit (beia) margin2 2010-2014

€M

12.9%

Premium

Sub-Premium

Mainstream

Below Mainstream

Value

23

TecateVideo

24

4. HEINEKEN USAPortfolio Strategy driving improved share

9 Distribution Centres &

6 Offices (White Plains HQ)

9.7 mhl beer

4.4% SOM

#2 Premium Position

Facts Economic country indicators are improving although overall beer market flat

Upscale outperforming led by craft, Mexican brands and cider

Femsa transaction brought in complementary Mexican brands Dos Equis and Tecate,

which are growing high single digits

Heineken® brand declined since 2008 and now stabilized

HEINEKEN ideally placed to outperform

Main Brands

25

2010 2011 2012 2013 2014

4. The Mexican brands are driving market share...With outperformance vs the US market since 2012

Dos Equis and Tecate in the US

+6.5% CAGR OG

Tecate Original-5% CAGR

HeinekenMexican brands

Others

Heineken US Brand split 2014

Heineken

Others

Heineken US Brand split 2005

Tecate Light34% CAGR

Dos Equis14% CAGR

26

Dos EquisVideo

27

4. HEINEKEN Brazil

Source: Nielsen, YTD August 2015.

Driving increased share by winning in the Premium segment

6 Breweries 12.1mhl Beer 9.4% Market share #3 Position

Facts

#2 in premium segment with Heineken®

Heineken® complemented by premium portfolio

Exciting potential longer term, despite near term economic challenges

Expanding capacity with 7th brewery

Strategic partnership with Coca-Cola bottlers provides scale

5% 5%6%

7%8%

9%

11%12%

6%

10%13% 14%

17%

2010 2011 2012 2013 2014 2015 2016 2017

Premium SOM Heineken® SOM of Premium

PremiumSOM

Main Brands

28

Heineken Door LockVideo

29

4. Canada, Caribbean and Export MarketsDiverse and profitable markets offer further opportunity for growth

Main CountriesSolid Regional Contributor

11,272 km

5 Brewery markets

4 Joint Ventures / Associates

40+ Export Markets

Group Beer

Revenue

2014 Data

30

5. SummaryWhat’s Brewing Seminar — HEINEKEN Americas

Positive outlook for future Americas beer market growth

Premium expected to outperform overall beer category

Clear strategy in place to win in the region

HEINEKEN Americas well placed to capture growth and continue to drive share