Heineken to axe 8,000 jobs after pub and bar closures hammer sales

Heineken cardboard beer grips Credit: PA Wire/PA Images

Beer giant Heineken is to slash 8,000 jobs globally after sales plunged sharply following the closure of pubs and bars.

The Dutch brewer said it will cut almost 10% of its 85,000 staff as part of its efforts to save two billion euro (£1.75 billion) over the next two years.

It said the restructuring of its head office, regional offices and local operations will lead to a one-off cost of around 420 million euro (£368 million).

Chief executive Dolf van den Brink, who joined the brewer in April, announced the major shake-up as the Amstel and Birra Moretti brewer swung to a loss for 2020 due to the pandemic.

It reported a net loss of 204 million euros (£178.7 million), compared with a 2.2 billion euro (£1.9 billion) profit in the previous year.

The group’s revenues plummeted by 17% over the year after pubs, bars and restaurants shut their doors in key regions for large part of the year.

Beer volumes tumbled by 8.1% over the year as on-trade sales, which cover trade from hospitality venues such as pubs, were hammered by restrictions.

Mr van den Brink said: “In a year of unprecedented disruption and transition, our teams rose to the occasion and quickly adapted while not losing sight of the need to continue investing for the future.

“The impact of the pandemic on our business was amplified by our on-trade and geographic exposure.

“We took diligent cost mitigation actions balanced with continued investment behind our growth platforms.”

It reported that UK retail volumes were strong, with its eponymous Heineken brand reporting double-digit growth in the UK.

The pub and restaurant trade has been hit hard by the pandemic. Credit: PA

Birra Moretti and Sol also saw strong growth in the UK, although cider sales decreased as it was heavily affected by UK pub closures.

A Heineken UK spokeswoman said: “The closure of pubs in March and subsequent restrictions, including over the Christmas period, have had an impact on sales volumes of beer and cider for the full year.

“While we experienced an increase in volumes in the off-trade, where our premium beer brands performed well, it in no way made up for the loss of volumes in the on-trade.

“The NHS vaccination programme is a light at the end of the tunnel, and we look forward to welcoming back consumers to pubs across the country as soon as it is safe to do so.”