HEINEKEN Strategy to Win in Americas

What’s Brewing Seminar HEINEKEN Americas HEINEKEN strategy to win in Americas

0New York 19 November 2015 Marc Busain

2015 Region President Heineken Americas

Managing Director Cuauhtémoc Moctezuma 2011 Heineken Mexico

2003 Managing Director Positions in Burundi, Egypt and France

2001 Finance Manager, Heineken Netherlands Supply

Started with HEINEKEN, Finance Manager 1996 Democratic Republic of Congo

1 Agenda HEINEKEN strategy to win in Americas

1 Revisiting the positive Americas region characteristics

2 HEINEKEN profile in Americas and contribution to HEINEKEN group

3 Regional strategic priorities

4 Key markets Update: . Mexico . US . Brazil . Canada, Caribbean and Export 5 Summary

2 1. Diverse markets with untapped growth potential With Beer Per capita consumption varied and low relative to more developed regions

Per Capita Beer Consumption (2014)

Western Europe 60

HEINEKEN countries

3 Source: Canadean 2014. Non HEINEKEN countries 1. Favourable population dynamics Region benefits from a younger average population base

% population under the age of 35 (2015 forecast) 73% 71% 70% 67% 63% 62% 62% 62% 62% 60% 59% 59% 56% 56% 56% 56% 54% 51% 48% 46% Europe average 43% 41%

Population growth 2015F-2020F 12 6 10 7 7 5 6 3 7 8 4 1 6 4 4 4 6 4 -5 4 5 in percentages

HEINEKEN countries

4 Source: UN World Population Prospects, Canadean. Non HEINEKEN countries 1. Compelling Premium beer opportunity With Premium beer share of market still relatively low in a number of countries

% PS of total beer market 2014 35% 34% Europe average 31%

23%

16% 16% 15% LATAM average 15%

11% 10% 9% 8% 8% 7% 5% 5% 2%

Panama USA Chile Canada Peru Ecuador Costa Rica Argentina Brazil Guatemala Honduras Venezuela Mexico El Salvador Nicaragua

Total beer market size 3 231 7 20 14 7 2 18 143 2 2 22 69 1 1 2014 (MHL)

Source: Canadean 2014. HEINEKEN countries Premium beer segment defined by Canadean 5 as >= 115 price index. Non HEINEKEN countries 1. Resulting in favourable regional volume expectations

Key Markets Beer consumption (mhl) . Favourable demographics with positive CAGR CAGR population growth and age profile Argentina & Chile 600 +1.8% . Positive beer market fundamentals with low +0.3% Brazil +1.7% beer per capita consumption and Premium +2.7% Andean* segment share of market relatively low 400 +2.6% +1.7% Other LATAM +3.1% +2.8% . Significant income growth in key developing Mexico +1.7% +2.4% markets Canada -2.4% -1.3% 200 . Premium expansion in mature markets where HEINEKEN Americas is well positioned to +0.2% +1.4% USA capture growth 0 2010 2014 2020F

Source: Canadean. 6 *Andean includes Venezuela, Peru, Colombia, Equador. 2. Americas is an important contributor to HEINEKEN’s business

Group beer volume Heineken® Consolidated EBIT

28.7% 8.9mhl 24.9%

29.5mhl

7 Source: HEINEKEN Annual Report 2014. 2. HEINEKEN Americas Footprint A collection of highly diverse markets and business models

# HEINEKEN Premium market share Canada Puerto Rico Haiti #2 #1 #1 United States #2

French West Indies Jamaica

Mexico Central America & Caribbean #1 #1 #2 #1 Costa Rica Suriname St. lucia #1 Brazil #1 #1 #2 Panama #2 Bahamas 9 Operating Companies Chile Argentina #1 6 Joint Ventures/ Associates #1 #2 40+ Export Markets

Source: Nielsen and Canadean 8 Premium beer segment defined by Canadean as >= 115 price index. 2. Americas regional brand overview A premium led brand portfolio complemented by strong mainstream brands

Mexico USA Brazil Canada Chile Argentina Panama Haiti Bahamas St Lucia Jamaica Heineken® Heineken® Amstel Light Heineken® Heineken® Heineken® Heineken® INTERNATIONAL Strongbow Strongbow Heineken® Heineken® Sol Strongbow Amstel Heineken® Heineken® Heineken® Strongbow AND DOMESTIC Bohemia Lagunitas2 Sol Guinness1 Desperados Dos Equis Imperial2 Guinness1 Guinness1 Guinness1 Desperados Affligem Dos Equis Royal Guard PREMIUM Xingu Newcastle Budweiser2 Guinness1 Red Stripe Newcastle Coors1 Dos Equis UPPER MAINSTREAM & Cristal2 Panama Red Stripe Sol Tecate Schneider2 Prestige Kalik Piton Escudo2 Soberana Dragon MAINSTREAM Indio Tecate Superior Kaiser Palermo2 Malta (LOWER) MAINSTREAM Carta Blanca Eclipse Bavaria Bieckert2 Talawah Kloster

1 Represents Licensed brands. 2 Represent Partner brands. 9 Heineken® may include Heineken Light. 2. Expanding our Footprint in the Craft Segment… and the Caribbean

. Acquired 50% shareholding in Lagunitas . 5th largest craft brewer in the US by volume . Lagunitas IPA is largest IPA Brand by volume in the US* and c.56% volume . Acquired Diageo’s 57% stake in D&G taking ownership to 73% MTO launched 6 November for remaining shares . IPA segment, fastest growing category in craft . D&G leading share in Jamaican beer market . Will continue to be run by current management . Red Stripe c.40% volume of D&G brand portfolio and the #1 . Current volume predominantly in the US brand in Jamaica . Exciting opportunity to expand through . Red Stripe c.50% in Jamaica, with large international markets HEINEKEN’s global platform including UK, Canada and US . Further international potential given heritage and distinctive attributes . Strategic asset within key growth market 10 * Source: Nielsen 2. With Topline driving solid EBIT growth

Group beer volume Consolidated revenue Consolidated EBIT (beia) In mhl In €m In €m

CAGR +4.8% CAGR +7.8% CAGR +8.8%

2010 2014 2010 2014 2010 2014

11 3. Regional strategic priorities Defined strategy to capture regional specific opportunities

1 2 3 4 5 6

WIN IN LEAD BY COOL SHAPE THE DRIVE BE BREWING PREMIUM MARKETING CIDER END2END COMMERCIALLY A BETTER LED BY AND CATEGORY PRODUCTIVITY ASSERTIVE WORLD HEINEKEN ® INNOVATION

12 Global strategy to exploit region specific opportunities. 1 Win in premium led by Heineken® Gaining momentum with Heineken® in the US, Mexico and in Brazil

® Heineken turnaround in US Mexico: Heineken® Brazil HEINEKEN in mhl Success Story +48% 4Y CAGR Yearly Growth CAGR +52%

Back to positive growth in 2015

Share of Premium 17% 14% 13% 10% Volume development 6% in khl

2007 2008 2009 2010 2011 2012 2013 2014 L52W 2010 2014 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 14 2015*

13 * Note: L52W ending 10/03/2015 1 Heineken Light – ‘best tasting light beer in the US’ Video

14 2 Lead by Cool marketing and innovation Marketing is driving consumer pull for our brands and innovations delivering sustainable top line growth

Cool Marketing Innovation Rate

. Americas has almost tripled revenue from innovations over the last 2 years (to c.6%) . Leveraging global innovation successes eg Radler . Focus on margin enhancing products which support top line ambitions

15 3 Shape the Cider Category Focus on Strongbow in the US is rapidly gaining momentum, driving double digit volume growth

. Distribution rights transfered from Vermont 2014 % Volume Share 7% Hard Cider Company (C&C) to in house from 1 January 2013 3.4% . Fastest growing cider brand in the US Beginning of the End of year . #2 market share year . Depletions up ytd September over 40% . Best Tasting hard Cider . Strong sampling increasing brand awareness . Flavours addressing consumer demand for variety and choice

HUSA and Canada account for 91% of volume. Nielsen Grocery through 01/03/2015, Brand Franchise.

16 3 Strongbow Video

17 4 Driving E2E Productivity To deliver increased efficiencies at the business

Productivity Improvement

15 6,000 . Ongoing productivity gains and cost saving initiatives have improved costs as % of revenue. . Main cost saving initiatives generated over €234m savings (excluding IPO synergies) in the course of three years (2011-2014): 10 4,000 . Supply Chain: FTE headcount optimization, Consumer value Engineering, Energy and Electricity Savings, Network Optimization . Commerce: FTE headcount efficiencies, Retail operation improvement in Mexico, Sponsorship improvements, Agency 5 2,000 Fees Savings 2012 2013 2014 2015YTD . Support: FTE headcount optimization Productivity per mhl / FTE Production FTE’s

18 5 Be Commercially Assertive To drive excellence in outlet execution

Draft Systems Right Channels and Customers

Excellent Outlet Execution

19 6 Brewing a Better World Sustainability is embedded in HEINEKEN Americas strategy

Safety First Responsible Sustainability Sustainable Consumption Sourcing

. Eco-efficiency: Tangible . Cool@work & alcohol policy . Haiti sorghum projects with targets for energy and water Clinton initiative to stimulate . Extending safety from brewery . Deliver on global industry reduction to sales & distribution commitments local farmers harvest . Water stewardship initiatives including road safety . Ongoing compliance to . 10% media spend target on in Mexico with local Supplier Code Procedure . Company wide Safety Strategy Enjoy Heineken® responsibly community for brewers for (the 5C’s) and 12 Life Saving sustainable water supply in Rules scarce areas

20 4. HEINEKEN Mexico Attractive growth prospect for beer

Facts  HEINEKEN’s largest market . 6 Breweries   Positive underlying market fundamentals, . 27.8 mhl beer including population growth, urbanisation, . 41.5% SOM growing middle class Main Brands . #2 Position  Beer the alcoholic beverage of choice (at 94%)  Exciting premium segment potential, still underpenetrated  Applying a targeted regional strategy to drive growth  OXXO partnership and development of own stores (Six) strengthening commercial execution and maximising volume and value

21 4. HEINEKEN Mexico Strong Topline growth since the acquisition

Strong national portfolio with Strategy continuing to deliver representation across varied price points impressive growth

Revenue1 Operating profit (beia)1 Operating profit (beia) 2010-2014 2010-2014 margin2 2010-2014 Premium €M €M €M CAGR +6% CAGR +20% 20.4%

Sub-Premium 12.9%

Mainstream

Below Mainstream 2010 2014 2010 2014 2010 2014 Value

1 Includes domestic beer operations only 22 2 Includes domestic beer and export operations Tecate Video

23 4. HEINEKEN USA Portfolio Strategy driving improved share

Facts  Economic country indicators are improving

. 9 Distribution Centres & although overall beer market flat 6 Offices (White Plains HQ)  Upscale outperforming led by craft, Mexican . 9.7 mhl beer brands and cider Main Brands . 4.4% SOM . #2 Premium Position  Femsa transaction brought in complementary Mexican brands Dos Equis and Tecate, which are growing high single digits  Heineken® brand declined since 2008 and now stabilized  HEINEKEN ideally placed to outperform

24 4. The Mexican brands are driving market share... With outperformance vs the US market since 2012

Dos Equis and Tecate in the US

+6.5% CAGR OG

Tecate Original -5% CAGR

Tecate Light 34% CAGR

Heineken US Brand split 2005 Heineken US Brand split 2014 Dos Equis Others Others 14% CAGR

Heineken Mexican 2010 2011 2012 2013 2014 brands Heineken

25 Dos Equis Video

26 4. HEINEKEN Brazil Driving increased share by winning in the Premium segment

Facts ® . 6 Breweries Main Brands  #2 in premium segment with Heineken . 12.1mhl Beer  Heineken® complemented by premium . 9.4% Market share portfolio . #3 Position  Exciting potential longer term, despite near term economic challenges 12% Premium 11%  Expanding capacity with 7th brewery SOM 9% 8%  Strategic partnership with Coca-Cola 7% 6% bottlers provides scale 5% 5% 17% 13% 14% 10% 6%

2010 2011 2012 2013 2014 2015 2016 2017

Premium SOM Heineken® SOM of Premium 27 Source: Nielsen, YTD August 2015. Heineken Door Lock Video

28 4. Canada, Caribbean and Export Markets Diverse and profitable markets offer further opportunity for growth

Solid Regional Contributor Main Countries 2014 Data

Group Beer

11,272 km

Revenue

5 Brewery markets 4 Joint Ventures / Associates 40+ Export Markets

29 5. Summary What’s Brewing Seminar — HEINEKEN Americas

 Positive outlook for future Americas beer market growth

 Premium expected to outperform overall beer category

 Clear strategy in place to win in the region

 HEINEKEN Americas well placed to capture growth and continue to drive share