The Amsterdam-based brewer employs around 85,000 people, so it will cut its workforce by almost 10%. That should reduce operating costs by around €350 million, but Heineken warned that it would face an initial restructuring charge of €420 million.

The job cuts will begin at head office, where one in five staff will lose their jobs in the next two months.

It follows a challenging year for the firm, which reported an 11.9% organic sales decline during 2020 after the Covid-19 pandemic significantly dented its on-trade business.

Analysts were expecting a 10.9% decline. Heineken’s share price dipped by 2% in early trading in Amsterdam following the news. The stock decreased 6% in 2020.

Operating profit decreased by 35.6% in 2020, and organic profit was down 49.4%. That resulted in diluted earnings per share of €2, down by more than 50% from €4.38 in 2019.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: “With little prospect of drinkers quenching their thirst with a beer at a bar in many of its crucial markets any time soon, the Covid-19 hangover is set to linger a lot longer for Heineken. It’s now expecting operating profits and margins to be below 2019 levels this year, with only a slow recovery forecast.”