Heineken (HEIA.AS)

Heineken stock slumped 5% on Wednesday after it warned profits could fall below estimates, and that high inflation would impact demand for beer, thanks to geopolitical and economic volatility.

The Dutch brewer, which is the world’s second-biggest brewer after AB InBev (ABI.BR), said volumes fell by 4.7% last year, with more than 60% of that driven by declines in Vietnam and Nigeria, where economic and political conditions hurt sales.

Dolf van den Brink, chief executive, said: "We remain cautious about the global economic and geopolitical outlook."

Last year, beer brewers raised prices significantly to offset steep increases in costs, which saw overall sales figures of €36.3bn (£30.96bn/$38.88bn), up on the previous year’s €35bn. However, profits came in at €2.3bn, compared to the €2.7bn the year before.

“This year, Heineken had to prioritise pricing to offset unprecedented levels of commodity and energy inflation," it said.

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Heineken added that this inflationary pressure tailed off towards the second half of the year, but highlighted that the economic climate would “remain a factor of uncertainty” into 2024.

It forecast future operating profits to be in the “low- to high-single-digit” range, with net profits lower than that due to currency and tax impacts.

Dunelm (DNLM.L)

Dunelm shareholders are set to receive a total of £103m through dividend payments as the group toasted strong sales and profits growth.

This will be through an interim ordinary dividend of 16p per share, up 7% from the first half a year earlier, as well as a £71m special dividend of 35p per share.

It came as pre-tax profits rose from £117.4m to £123m, while sales climbed 4.5% to £872.5m in the first half to 30 December.

Nick Wilkinson, chief executive, said: “Despite ongoing pressures on consumers, we are encouraged by the wide variety of new customers shopping with Dunelm, and existing shoppers also coming back more frequently.”

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However, the Leicester-based homewares firm said recent improvements in profit margins will slow over its second half as it flagged that shipping costs are rising again, as well as a drag from currency movements.

“We are managing the impact of ships taking longer, more costly routes as they avoid the Red Sea area," it said.

“We have a tight grip on operating costs and were therefore able to partially offset some of the inflationary increases and investment through productivity and efficiency initiatives.”