Shared Challenges

Letter from the Chairman

For Mahou San Miguel, 2018 was a challenging year in which we were called on to give the best of ourselves. As a result: we learned, we grew and we involved all our business units and corporate divisions in contributing to our development in important ways. It has been, without a doubt, a great year.

We are a unique company, made up of great people who, moreover, take pride in being part of this big family. And so, for another year, according to the Merco Talento rankings, we are the best brewer to work for in this country, with an excellent rating from our own employees, making us the third-best regarded Spanish company by its employees.

Nearly 3,200 professionals who, together with our partners and distributors, make our company an excellent employer nationally, with a diverse and talented team that works in an increasingly collaborative and transversal way. This is allowing us to make great progress in the basic pillars of our 2020 Strategic Plan, which will contribute to transforming the company to guarantee robust leadership in the sector over the long term.

In 2018 we also took important steps towards fulfilling the 20 commitments established in our Framework for Sustainability, “Somos 2020”, particularly in terms of sustainable mobility, with the incorporation of electric vehicles into our commercial fleet; energy-efficiency measures and environmental investments aimed at conserving natural resources; extension of our responsibility to the entire value chain by training distributors and suppliers on Sustainability best practices; and care for our employees, with initiatives to promote their well-being, flexibility and work-life balance.

In terms of Innovation, we promoted and prioritised our projects through the Innova 2020 Plan by defining clear processes to ensure their success. Additionally, we developed the new 360º Innovation Model, which goes well beyond launching new products and encompasses all of our processes.

Digitalisation, for its part, involves a new way of thinking and working and, in 2018, we identified six key paths that will enable us to transform ourselves in this area, thereby ensuring our future competitiveness. Likewise, the roll-out of the System of Excellence was carried out as anticipated, and 50% of our employees have already received training to ensure that we improve our efficiency in three key areas: processes, strategy and teams, thereby focusing our efforts on the things that truly add value.

We have made progress in our strategic pillars, and the results tell us that we are doing this well. Last year, all our Business Units showed very good performance and, as a result, today our leadership position in our country is stronger than ever and we are consolidating ourselves as the most international Spanish brewer.

Our sales volume rose to 18.3 million hectolitres. Similarly, our turnover reached €1.299 billion and investment rose to €120 million, dedicated primarily to updating and improving our breweries, product innovation and premiumisation of the sector.

In Spain, we grew by focusing on driving the category, promoting beer culture and developing the consumption experience. We also launched important new products to the market: Mahou Maestra Dunkel, a toasted lager beer with three types of selected malts and brewed using the traditional process of triple decoction; Numeradas de Alhambra, three varieties aged in sherry barrels; the new Cervezas de Invierno from Nómada; and the La Salve collection of "Cervezas con Historia", the first beers produced at the brewery in Bolueta (Bilbao), are just some examples.

But we have not only innovated within our borders. In India, we launched Mahou Maestra Wheat, the first Spanish beer of this type brewed and bottled in the South Asian country, created specifically for the local market. Moreover, in the United States, we presented a beer developed collaboratively by Mahou San Miguel and Founders Brewing, Trigo, which was recognised with an international prize at the Brussels Beer Challenge.

Another example of innovation is the opening of the first Brewhub in Spain, which broke ground in 2018 and represents an investment of €11 million. Located next to our brewery in Córdoba, it represents major support to the craft segment, in which we have been pioneers in Spain as a result of our collaborations with international craft brewers like Founders Brewing and Avery Brewing, and Spanish ones like Nómada Brewing.

Today our leadership position in our country is stronger than ever and we are consolidating ourselves as the most international Spanish brewer

Nor can we forget our focus on local beers, which we demonstrated by expanding our presence in the La Salve brewery in Bilbao. Last year we acquired a 75.15% stake in the Canary Islands company Aguas del Valle de la Orotava, adding the mineral water Fonteide to our portfolio and strengthening our positioning in the islands.

And, of course, throughout 2018 we continued to create value for our society and contributed €1.367 billion to the Spanish economy, thus promoting social, cultural and economic development of the communities where we operate as a priority.

Additionally, through our Foundation, we continued to create opportunities for young people at risk for social exclusion, in collaboration with our on-trade customers, through an innovative public-private training programme that has successfully placed 90% of the young people trained in stable, quality jobs. Likewise, we promote volunteer actions with great value and impact in our society, in which nearly 600 of our company’s employees have participated.

A year of challenges shared with our team, customers, distributors and suppliers, all key elements in our business without which it would be impossible for us to be the company that we are. A year we closed with a sense of satisfaction for all that we achieved and which has prepared us to look to the future with even more enthusiasm, if possible.

José Antonio Mahou Herráiz
Mahou San Miguel Chairman