“Vrumona became part of Royal Unibrew in the fourth quarter of 2023. The integration is proceeding according to plan, and we have already started to realize synergies. We are optimistic about the future and are confident that as a new Western European platform we will deliver profitable growth in the coming years.“
Managing Director Vrumona
In 2023, volumes increased by 36% to 2.2 billion hectoliters significantly impacted by the acquisition of Vrumona in the Netherlands. Adjusting for this, volumes dropped organically by 14% due to de-stocking in Italy and a very good summer in 2022. Net revenue increased by 28% to DKK 1,738 million and adjusted for the acquisition in the Netherlands net revenue declined organically by 4%..
EBIT declined from DKK 157 million in 2022 to DKK 141 million in 2023. Organically EBIT declined by 25% driven by de-stocking in the Italian On-Trade wholesale beer market and an exceptional good summer in Italy in 2022 making the comparable numbers difficult to repeat in 2023. That development resulted in an EBIT margin of 8.1%, which was 3.5 percentage points lower than in 2022. Adjusting for the acquisition, the organic EBIT margin declined by 2.5 percentage points to 9.1%.
Development and initiatives in 2023
In 2023, the Netherlands saw noteworthy macroeconomic stability characterized by a consistent GDP growth and low unemployment rates. The elevated inflation rates at the beginning of 2023 led to a decrease in consumer spending power and diminished consumer confidence.
These factors had an impact on the beverage sector in 2023, particularly in the first half of the year. Both non-alcoholic and alcoholic beverage categories encountered challenges in retail, as consumer price increases occurred due to high inflation rates. The soft drinks category also experienced dynamic shifts, resulting in market volume decline but market value growth.
On the sustainability side, Vrumona has conducted several projects during 2023. A modular flexible warehouse has been built, which meant less traffic back and forth to the external warehouse. Moreover we were able to reduce our energy consumption by 5% by means of continuous improvement projects.
Commercially, Vrumona ran a successful pilot at the biggest retailer in the Netherlands with a new shelf layout for the cola segment with the aim to grow share of Pepsi and the category. After extensive research and a period of careful testing throughout the country, the new cola shelf was rolled out in 850 shops in the autumn, leading to significant category growth in the segment thanks to the perception of more offer and less stress in choosing for shoppers.
And last, but not least, there have been many new campaigns and new introductions such as Mocktails under our Royal Club brand, providing the consumer with a deliciously refreshing drink, without alcohol and without sugar. Fully in line with our leading position in providing healthier drinks.
In 2023, the Italian business grew market share in beer, carbonated soft drinks and energy drinks in the Off-Trade.
In Off-Trade, the Ceres brand significantly outperformed the market with a double-digit value growth in sell-out driven by an extended pack/price strategy on multipacks, a new 50 cl can format launch, and with a new marketing campaign to celebrate 60 years of Ceres Brand in Italy. In On-Trade Ceres performance has been impacted by high stock in the beginning of 2023, but normalized during the second quarter of 2023, and we have now had nine months of balanced sell-in and sell-out. In 2023, sell-out grew both volume and value when compared to 2022.
Throughout 2023 we implemented price increases according to our plans, for all categories.
The LemonSoda range also grew significantly faster than the underlying CSD market gaining market shares in all the segments (Lemonade, Orangeade and Other flavours). The growth was supported by a new campaign and a packaging special edition celebrating the “original Italian lemonade” and by a strong commercial focus in the promo and in-store execution. The new Zero range is driving the growth of citrus zero CSD category, with a significant share of market increase both for Lemonsoda Zero and Oransoda Zero.
We also had a double-digit growth in the fast growing energy drinks market. Lemonsoda Energy is today well established as the number three brand in the market, with a range focused on the strong growing ‘’juicy’’ segment. We also entered with success in the ‘’original’’ segment with the launch of Crazy Tiger for selected customers.