Amsterdam, 1 August 2016 - Heineken N.V. (EURONEXT: HEIA; OTCQX: HEINY) today announces:
• Organic revenue +4.7% with revenue per hectolitre up +0.8%
• Consolidated beer volume +4.1% with growth in Americas, Asia Pacific and Europe offsetting weaker volume in Africa Middle East & Eastern Europe
• Heineken® volume in premium segment +2.6%
• Operating profit (beia) +12.6% organically
• Net profit (beia) of €977 million, up 11.2% organically
• Diluted EPS (beia) of €1.71 (2015: €1.59)
• FY 2016 margin expansion expected to be in line with medium term guidance

CEO STATEMENT

Jean-François van Boxmeer, CEO, Chairman of the Executive Board, commented:
"Our first half performance reflects a very good first quarter, also helped by softer comparatives, and a solid second quarter. Whilst Africa Middle East & Eastern Europe continued to be challenging, performance was strong in some key developing markets such as Vietnam and Mexico. Europe also contributed to our results with positive momentum and a clear focus on operational excellence. We are convinced that our well-balanced global footprint, sustained investment in brands and innovation, and focus on the premium segment continue to give us a unique competitive advantage to win in our markets. Despite adverse economic conditions in some developing markets and currency headwinds, we expect full year margin expansion in line with our medium term guidance of around 40bps per annum.''

FINANCIAL SUMMARY
Key financials 1,2 HY16 HY15 Total Organic
(in mhl or € million unless otherwise stated) growth
% Growth
%
Revenue 10,094 9,896 2.0 4.7
Revenue/hl (in €) 91 96 -4.9 0.8
Operating profit (beia) 1,705 1,549 10.1 12.6
Operating profit (beia) margin 16.9% 15.7% 124 bps
Net profit (beia) 977 915 6.8 11.2
Net profit3 586 1,144 -48.8
Diluted EPS (beia) (in €) 1.71 1.59 7.8
Free operating cash flow 541 486 11.3
Net debt/ EBITDA (beia)4,5 2.4 2.3

1 Consolidated figures are used throughout this report, unless otherwise stated; please refer to the Glossary section for an explanation of terms used throughout this report
2 A reconciliation between non-GAAP measures and IFRS measures is included in note 10 on page 33
3 Net profit is after EIA, for details on EIA please refer to page 3 and 13
4 Includes acquisitions and excludes disposals on a 12 month pro-forma basis
5 Net debt definition was revised in December 2015 and HY15 restated to reflect this, for more detail see footnote 1 on page 13


FULL YEAR 2016 OUTLOOK STATEMENT
• For 2016 HEINEKEN expects to deliver further organic revenue and profit growth, with margin expansion in line with the medium term margin guidance of a year on year improvement in operating profit (beia) margin of around 40bps. This takes into account the tough comparatives and increasing currency headwinds in the second half of the year.
• We expect an average interest rate of c.3.1%, and an effective tax rate (beia) broadly in line with 2015 (2015: 27.8%).
• Capital expenditure related to property, plant and equipment is expected to be slightly below €2 billion (2015: €1.6 billion).

OPERATIONAL REVIEW
After a strong first quarter, boosted by Easter timing and a strong Vietnamese and Chinese New Year, volume growth in the second quarter was more subdued. In Africa Middle East & Eastern Europe following growth in the first three months of the year, volume declined in the second quarter, due to tougher comparatives and a challenging economic backdrop. Revenue per hectolitre improved organically, with a positive contribution from both price and mix.

HEINEKEN continues to invest in key developing markets and opened a new brewery in Shanghai in May 2016.

Revenue increased 4.7% organically, with a 3.8% increase in total volume and a 0.8% increase in revenue per hectolitre. The underlying price mix impact for the six months was 1.1%.

Consolidated beer volume grew 4.1% organically in the first half of the year. Performance in the first quarter was particularly strong, up 7.0% organically, followed by more moderate growth of 1.8% in the second quarter.

Consolidated beer volumes
(in mhl) 2Q16 2Q15 Organic
growth % HY16 HY15 Organic growth %
Heineken N.V. 53.5 50.6 1.8 97.0 89.9 4.1
Africa Middle East & Eastern Europe 10.0 9.8 -5.9 19.1 17.9 -1.2
Americas 14.6 14.1 1.6 28.1 26.5 4.7
Asia Pacific 5.8 4.7 16.0 11.5 9.1 19.4
Europe 23.1 22.0 2.4 38.3 36.4 2.3

Heineken® volume in the premium segment grew 2.6%, with positive momentum in all regions apart from Africa Middle East & Eastern Europe. In particular, the brand grew double digit in Brazil, the UK, Mexico, New Zealand, Cambodia and Romania. Brand growth was also strong in China, France and Ireland. Favourable performance across these markets more than offset weaker volume in Russia, Vietnam and Algeria. Heineken® continued to benefit from leveraging global platforms such as UEFA Champions League, the Cities, Music, and Product Stories campaigns. During the second quarter, HEINEKEN announced a multi-year Global partnership with Formula 1®, starting in September 2016 with the newly renamed Formula 1 Gran Premio Heineken d'Italia in Monza.

Heineken® volume
(in mhl) 2Q16 Organic
growth
% HY16 Organic
growth
%
Heineken® volume in premium segment 8.3 0.8 15.3 2.6
Africa Middle East & Eastern Europe 1.1 -8.8 2.1 -5.0
Americas 2.4 0.7 4.7 3.5
Asia Pacific 1.6 1.9 3.2 3.5
Europe 3.2 3.9 5.3 4.6

The first half saw continued success of our broader premium portfolio strategy. Affligem, our Belgian abbey beer, grew double digit, and was particularly strong in France. Sol Premium, originating from Mexico, grew double digit, driven by Brazil and Compañia Cervecerías Unidas S.A. (CCU) markets in Latin America. Desperados, the tequila flavoured beer, saw high single digit volume growth, with strong performance in Poland, France and Spain.

Cider volume increased double digit, with accelerating momentum in the second quarter. The continued success of Strongbow Dark Fruit as well as Strongbow Cloudy Apple and Old Mout, underpinned volume growth in the UK, reaffirming our leading position in the home base of cider. In Europe, Romania, Ireland and Czech Republic delivered particularly strong growth, with volume double the level of the prior year. In Americas, cider volume grew double digit in Mexico and Canada, and we grew in the US ahead of the category.

Innovation, which is firmly embedded in HEINEKEN company strategy, delivered €1.1 billion in revenue, implying an innovation rate of 10.5%. Our innovation agenda focuses on low and no alcohol propositions, craft and variety beers, as well as new draught systems.

Operating profit (beia) grew 12.6% organically, reflecting higher revenue and cost efficiencies.

NET PROFIT

Net profit (beia) increased 11.2% organically to €977 million.
Exceptionals included an asset impairment of €233 million in the Democratic Republic of Congo (DRC).
Net profit after exceptionals was €586 million. In 2015 reported net profit included an exceptional gain of €379 million from the sale of Empaque.

TRANSLATIONAL CURRENCY CALCULATED IMPACT

Using spot rates as at 28 July 2016 the calculated FY negative currency translational impact would be approximately €200 million at operating profit (beia), and €110 million at net profit (beia).

INTERIM DIVIDEND

In accordance with its dividend policy, HEINEKEN fixes the interim dividend at 40% of the total dividend of the previous year. As a result, an interim dividend of €0.52 per share of €1.60 nominal value will be paid on 11 August 2016. The shares will trade ex-dividend on 3 August 2016.

BREWING A BETTER WORLD
In the first half of the year HEINEKEN's sustainability strategy, Brewing a Better World, continued to make progress. Highlights included the installation of four wind turbines in Europe's largest brewery in Zoeterwoude, the Netherlands. Operational since the second quarter of this year, these deliver up to 40% of the brewery's entire electricity requirements. The Heineken® brand global 'Moderate Drinkers Wanted' campaign has also now featured in 14 countries, encouraging responsible alcohol consumption.

INVESTOR CALENDAR HEINEKEN N.V.

Trading Update for Q3 2016 26 October 2016
What's Brewing Seminar, London 25 November 2016
Full Year 2016 Results 15 February 2017