REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders, the Board of Directors, and the Executive Board of Heineken N.V.
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial position of Heineken N.V. and subsidiaries (the "Company") as of December 31, 2019 and 2018, the related consolidated income statements and consolidated statements of comprehensive income, cash flows and changes in equity, for each of the three years in the period ended December 31, 2019, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of
December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2019, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.
Adoption of New Accounting Standard
As discussed in note 4 to the consolidated financial statements, effective January 1, 2019, the Company adopted IFRS 16 - Leases, using the modified retrospective method.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte Accountants B.V.
Amsterdam, the Netherlands
February 11, 2020
We have served as the Company's auditor since 2015.
F-120
Consolidated Income Statement
For the year ended 31 December | ||||||||
In millions of € | Note | 2019 | 2018* | 2017* | ||||
Revenue | 6.1 | 28,521 | 26,811 | 25,843 | ||||
Excise tax expense | 6.1 | (4,552) | (4,322) | (4,234) | ||||
Net revenue | 6.1 | 23,969 | 22,489 | 21,609 | ||||
Other income | 6.2 | 95 | 75 | 141 | ||||
Raw materials, consumables and services | 6.3 | (14,592) | (14,001) | (13,334) | ||||
Personnel expenses | 6.4 | (3,880) | (3,749) | (3,550) | ||||
Amortisation, depreciation and impairments | 6.6 | (1,959) | (1,693) | (1,587) | ||||
Total other expenses | (20,431) | (19,443) | (18,471) | |||||
Operating profit | 3,633 | 3,121 | 3,279 | |||||
Interest income | 11.1 | 75 | 71 | 78 | ||||
Interest expenses | 11.1 | (529) | (492) | (468) | ||||
Other net finance income/(expenses) | 11.1 | (59) | (64) | (123) | ||||
Net finance expenses | (513) | (485) | (513) | |||||
Share of profit of associates and joint ventures | 10.3 | 164 | 210 | 75 | ||||
Profit before income tax | 3,284 | 2,846 | 2,841 | |||||
Income tax expense | 12.1 | (910) | (741) | (740) | ||||
Profit | 2,374 | 2,105 | 2,101 | |||||
Attributable to: | ||||||||
Shareholders of the Company (net profit) | 2,166 | 1,913 | 1,883 | |||||
Non-controlling interests | 208 | 192 | 218 | |||||
Profit | 2,374 | 2,105 | 2,101 | |||||
Weighted average number of shares - basic | 6.7 | 573,643,551 | 570,146,069 | 570,112,097 | ||||
Weighted average number of shares - diluted | 6.7 | 574,217,111 | 570,663,632 | 570,361,374 | ||||
Basic earnings per share (€) | 6.7 | 3.78 | 3.36 | 3.30 | ||||
Diluted earnings per share (€) | 6.7 | 3.77 | 3.35 | 3.30 | ||||
* Restated for IAS 37. Refer to note 4 for further details.
F-121
Consolidated Statement of
Comprehensive Income
For the year ended 31 December | |||||||||
In millions of € | Note | 2019 | 2018* | 2017* | |||||
Profit | 2,374 | 2,105 | 2,101 | ||||||
Other comprehensive income, net of tax: | |||||||||
Items that will not be reclassified to profit or loss: | |||||||||
Remeasurement of post-retirement obligations | 12.3 | (210) | 221 | 64 | |||||
Net change in fair value through OCI investments 1 | 12.3 | 9 | 11 | - | |||||
Items that may be subsequently reclassified to profit or loss: | |||||||||
Currency translation differences | 12.3 | 369 | (106) | (1,475) | |||||
Reclassification of currency translation differences to profit and loss | 12.3 | 59 | |||||||
Change in fair value of net investment hedges | 12.3 | (43) | (3) | 26 | |||||
Change in fair value of cash flow hedges | 12.3 | 64 | (67) | 109 | |||||
Cash flow hedges reclassified to profit or loss | 12.3 | 21 | (77) | (3) | |||||
Net change in fair value through OCI investments 1 | 12.3 | 1 | - | 68 | |||||
Cost of hedging | 12.3 | (5) | 6 | - | |||||
Share of other comprehensive income of associates/joint ventures | 12.3 | (20) | (36) | (7) | |||||
Other comprehensive income, net of tax | 12.3 | 186 | (51) | (1,159) | |||||
Total comprehensive income | 2,560 | 2,054 | 942 | ||||||
Attributable to: | |||||||||
Shareholders of the Company | 2,328 | 1,858 | 839 | ||||||
Non-controlling interests | 232 | 196 | 103 | ||||||
Total comprehensive income | 2,560 | 2,054 | 942 |
* Restated for IAS 37. Refer to note 4 for further details.
- In 2017 these investments were classified as available-for-sale investments F-122
Consolidated Statement of Financial Position
As at 31 December | As at 31 December | |||||||||||||
In millions of € | Note | 2019 | 2018* | In millions of € | Note | 2019 | 2018* | |||||||
Intangible assets | 8.1 | 17,769 | 17,459 | Shareholders' equity | 11.4 | 16,147 | 14,525 | |||||||
Property, plant and equipment | 8.2 | 13,269 | 11,359 | Non-controlling interests | 11.4 | 1,164 | 1,183 | |||||||
Investments in associates and joint ventures | 10.3 | 4,868 | 2,021 | Total equity | 17,311 | 15,708 | ||||||||
Loans and advances to customers | 8.3 | 277 | 341 | |||||||||||
Deferred tax assets | 12.2 | 647 | 626 | Borrowings | 11.3 | 13,366 | 12,628 | |||||||
Other non-current assets | 8.4 | 1,255 | 1,220 | Post-retirement obligations | 9.1 | 1,189 | 954 | |||||||
Total non-current assets | 38,085 | 33,026 | Provisions | 9.2 | 756 | 833 | ||||||||
Deferred tax liabilities | 12.2 | 1,422 | 1,431 | |||||||||||
Inventories | 7.1 | 2,213 | 1,920 | Other non-current liabilities | 11.6 | 153 | 168 | |||||||
Trade and other receivables | 7.2 | 4,123 | 3,795 | Total non-current liabilities | 16,886 | 16,014 | ||||||||
Current tax assets | 123 | 71 | ||||||||||||
Derivative assets | 11.6 | 28 | 35 | Borrowings | 11.2/11.3 | 3,686 | 2,358 | |||||||
Cash and cash equivalents | 11.2 | 1,821 | 2,903 | Trade and other payables | 7.3 | 7,520 | 6,891 | |||||||
Assets classified as held for sale | 10.2 | 111 | 401 | Returnable packaging deposits | 7.4 | 565 | 569 | |||||||
Total current assets | 8,419 | 9,125 | Provisions | 9.2 | 184 | 164 | ||||||||
Current tax liabilities | 283 | 245 | ||||||||||||
Total assets | 46,504 | 42,151 | ||||||||||||
Derivative liabilities | 11.6 | 69 | 70 | |||||||||||
Liabilities associated with assets classified as held for sale | 10.2 | - | 132 | |||||||||||
Total current liabilities | 12,307 | 10,429 | ||||||||||||
Total equity and liabilities | 46,504 | 42,151 |
* Restated for IAS 37. Refer to note 4 for further details.
F-123
Consolidated Statement of Cash Flows
For the year ended 31 December | ||||||||
In millions of € | Note | 2019 | 2018* | 2017* | ||||
Operating activities | ||||||||
Profit | 2,374 | 2,105 | 2,101 | |||||
Adjustments for: | ||||||||
Amortisation, depreciation and impairments | 6.6 | 1,959 | 1,693 | 1,587 | ||||
Net interest expenses | 11.1 | 454 | 421 | 390 | ||||
Other income | 6.2 | (95) | (75) | (141) | ||||
Share of profit of associates and joint ventures and dividend income on fair value through OCI investments | (173) | (228) | (84) | |||||
Income tax expenses | 12.1 | 910 | 741 | 740 | ||||
Other non-cash items | 240 | 201 | 393 | |||||
Cash flow from operations before changes in working capital and provisions | 5,669 | 4,858 | 4,986 | |||||
Change in inventories | (257) | (129) | (185) | |||||
Change in trade and other receivables | (245) | (66) | (241) | |||||
Change in trade and other payables and returnable packaging deposits | 510 | 908 | 495 | |||||
Total change in working capital | 8 | 713 | 69 | |||||
Change in provisions and post-retirement obligations | (121) | (31) | (131) | |||||
Cash flow from operations | 5,556 | 5,540 | 4,924 | |||||
Interest paid | (528) | (555) | (463) | |||||
Interest received | 52 | 118 | 98 | |||||
Dividends received | 181 | 109 | 109 | |||||
Income taxes paid | (924) | (824) | (786) | |||||
Cash flow related to interest, dividend and income tax | (1,219) | (1,152) | (1,042) | |||||
Cash flow from operating activities | 4,337 | 4,388 | 3,882 | |||||
Investing activities | ||||||||
Proceeds from sale of property, plant and equipment and intangible assets | 177 | 111 | 187 | |||||
Purchase of property, plant and equipment | (1,915) | (1,888) | (1,696) | |||||
Purchase of intangible assets | (186) | (167) | (137) | |||||
Loans issued to customers and other investments | (249) | (239) | (259) | |||||
Repayment on loans to customers and other investments | 64 | 41 | 54 | |||||
Acquisition of subsidiaries, net of cash acquired | (183) | (70) | (1,047) | |||||
Acquisition of/additions to associates, joint ventures and other investments | (2,875) | (159) | (93) | |||||
Disposal of subsidiaries, net of cash disposed of | 244 | 15 | 10 | |||||
Disposal of associates, joint ventures and other investments | 50 | 1 | 16 | |||||
Cash flow (used in)/from investing activities | (4,873) | (2,355) | (2,965) | |||||
Financing activities | ||||||||
Proceeds from borrowings | 2,288 | 1,694 | 3,268 | |||||
Repayment of borrowings | (2,150) | (1,545) | (3,205) | |||||
Payment of lease commitments | (259) | - | - | |||||
Dividends paid | (1,223) | (1,090) | (1,011) | |||||
Purchase own shares and shares issued | 428 | (20) | - | |||||
Acquisition of non-controlling interests | (103) | (2) | (18) | |||||
Other | 3 | (4) | - | |||||
Cash flow (used in)/from financing activities | (1,016) | (967) | (966) | |||||
Net cash flow | (1,552) | 1,066 | (49) | |||||
Cash and cash equivalents as at 1 January | 2,248 | 1,177 | 1,177 | |||||
Effect of movements in exchange rates | (9) | 5 | 5 | |||||
Cash and cash equivalents as at 31 December | 11.2 | 687 | 2,248 | 1,133 | ||||
* Restated for IAS 37. Refer to note 4 for further details.
F-124
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FEMSA - Fomento Económico Mexicano SA de CV published this content on 07 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 07 November 2022 18:13:08 UTC.