Sustainable growth

Swinkels Family Brewers
The SFB-division includes sales from all breweries in the Netherlands and Belgium. Here, important sales channels are supermarkets, web shops and on-trade locations in Western Europe but also exports to customers and distributors in the rest of the world. Important suppliers are energy companies and all suppliers of raw and packaging materials.

The ‘beer division’ is experiencing challenging market conditions. Presumably bad weather in the spring and fall also led to a lower beer consumption. Still, compared to 2022, we see an increase in turnover in the beer division.

Holland Malt
The malting division consists of the Lieshout malting plant and the Eemshaven malting plant, which will be emission-free by March 15, 2024. This means that the malting plant runs entirely on green electricity and thus emits no greenhouse gases. This is of great value from the viewpoint of sustainability, but also given rising energy costs.

Holland Malt’s turnover and profits grew in 2023. We owe this to an efficient production and by buying and selling at the right time, and at good prices. Holland Malt purchases high quality malting barley from farmers (cooperatives) and exports the malt produced to breweries and distilleries around the world.

Habesha
Together with local shareholders, we brew the beers Habesha, Kidame, Feta and malt beverage Negus in Ethiopia. Habesha purchases premium ingredients from local farmers and malting plants. Local distributors and traders are regular customers of Habesha.

The Habesha division shows great figures. We are seeing an increase thanks to the expansion with draft beer and the popular non-alcoholic malt beverage Negus. We also managed to implement price increases to compensate for increased raw material prices in Ethiopia.

Ethiopia has an economy with hyperinflation. This greatly affects the purchasing power of the population. Therefore, Habesha was forced to apply hyperinflation accounting to the figures. Because of accounting rules, we have revalued Habesha’s figures because the assets have become worth more due to strong inflation.

Cuba
In Cuba, we invested in the construction of a new brewery and launched the Parranda brand. Sales of this Cuban beer began in July 2023.

In 2023, there were four major developments in our organization:

• The advent of the Intelligent Brewery, a program focused on digital transformation. The goal is to collect uniform data, generate better information and optimize workflows. A digital platform supports the Intelligent Brewery. This platform was optimized in 2023 and is now entering its final phase.
• The brewery in Cuba opened in the summer of 2023. We launched the Parranda brand and started sales.
• The transformation to Holland Malt’s emission-free malting plant in Eemshaven. The transformation is completed in March 2024.
• Ethiopia’s financial figures have been adjusted for hyperinflation. Inflation for 3 years totaled over 100%. As a result, we applied hyperinflation accounting for 2023.

In financial year 2023, Royal Swinkels Family Brewers received EUR 2.7 million in grants from the Dutch government. DEI (Demonstration Energy and Climate Innovation) is the largest grant. Malting company Holland Malt received this grant for the investments in the emission-free malting plant in Eemshaven. Thanks in part to these grants, we have been able to make a positive contribution to Dutch sustainability investments.

In 2023, we expanded several working capital projects. Examples include adding more suppliers to our supplier finance programs and introducing the receivables finance program to more customers. This focus on working capital resulted in considerably more investment capital in 2023. Thanks to these investments, our liquidity ratio improved to 0.95 (2022: 0.89).

The net cash flow of the company was positive (EUR 0.8 million). Incoming cash flows from operating activities (EUR 101.6 million) and financing activities (EUR 14.3 million) were used for investments (EUR 115.1 million). In the statement of cash flows, we see the following developments:

• The incoming cash flow from operating activities was higher than the previous year due in part to a higher net result and a lower negative change in working capital.
• The outgoing cash flow from investing activities was lower than in 2022 due to investments in on-trade locations in Belgium the previous year.
• The incoming cash flow from financing activities was lower than the prior year due to higher repayments on both our ongoing revolving credit facility and credit institutions in Ethiopia.

As a family business, we do our part for society. An obvious example is paying taxes. We strive for a transparent relationship with the tax authorities at home and abroad. We are also committed to paying the right amount of tax in the right place at the right time. You can read how we do this in our tax policy on our website.

All of Royal Swinkels Family Brewers’ internal transfer prices are set “at arm’s length” and documented according to OECD (Organization for Economic Cooperation and Development) Transfer Pricing principles. We also endorse the OECD’s Base Erosion and Profit Shifting (BEPS) program.

The applicable weighted average tax rate is 25.8% (2022: 27.6%). We calculate this rate on the basis of results before taxes in the various tax jurisdictions. The tax charge in the profit and loss statement for 2023 amounts to EUR 23,887K, or 35% of the result before taxes (2022: 30.1%).

In 2023, we paid EUR 14.7 million in corporation tax, EUR 154.4 million in excise duties and EUR 137.1 million in other taxes.

Other taxes amount to EUR 91.3 million from VAT, EUR 43.5 million from payroll taxes and social security charges and EUR 2.3 million from other taxes.