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Why Heineken's boss is praying for higher oil prices with Reuters
Heineken CEO: Remain optimistic on Africa investments

Declining sales in Africa has left Heineken's chief executive "praying for higher oil prices," he told CNBC on Monday.

The world's third-largest brewer reported slightly better than expected first-half operating profit on Monday as strength in Asia and Western Europe offset declining sales in Africa and Eastern Europe.

Heineken Chief Executive Jean-Francois van Boxmeer told CNBC Monday that while the company had "performed well in volume, revenue and profits," the downside had been its "subdued performance in Africa and the Middle East."

Van Boxmeer said countries like Nigeria had been an "uninterrupted growth story for the last 11 years" and that the decline in oil prices were the "basis for Nigeria's turmoil and the same is true for Russia."

"One day it will restore we have to hope but meanwhile, the perspective is a bit subdued but they are holding up pretty well over there."

"We are facing some currency headwinds. The market is holding up pretty well I must admit, but of course people will grab for the cheaper beers in our assortment rather than the premium beers and that will last for some months to come and we have only to pray for higher oil prices."

Nonetheless, van Boxmeer said the company remained "very optimistic" about its investments in Africa in the medium-term and long-term because the growing middle classes, demographic growth and urbanization were set to continue.

"The African and Middle-East regions remain a growth area for Heineken," he said.

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The brewer of Heineken, Europe's best-selling lager, Tiger and Sol said that despite poor economic conditions in some developing markets and the impact of currencies, operating margins should expand in line with its medium-term target of about 40 basis points per year.

The company said its performance in Vietnam and Mexico had been strong, but it suffered weaker results in Russia, the Democratic Republic of Congo, Ethiopia, Egypt and major market Nigeria.

This is Heineken's growth strategy in Asia

Nigeria abandoned its 16-month currency peg tying the naira to the dollar in June to alleviate a chronic foreign currency shortage choking growth in Africa's biggest economy hit by a slump in oil prices. The naira has fallen by almost 40 percent since.

First-half operating profit before one-offs rose 12.6 percent on a like-for-like basis to 1.71 billion euros ($1.91 billion), above the average 1.67 billion euro expectation in a Reuters poll.

Net profit was up 11.2 percent at 977 million euros, just below the average expectation of 998 million euros.

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