AB InBev exceeds second-quarter profit expectations
Beer giant reports forecast-beating core profit but revenue and volumes disappoint
01 August 2024 - 09:42
byEmma Rumney
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A worker checks beer quality at an Anheuser-Busch InBev brewery in Leuven, Belgium. Picture: FRANCOISE LENOIR/REUTERS
London — Beer giant Anhueser-Busch InBev reported on Thursday forecast-beating core profit for the second quarter, but its revenue and volumes fell short of expectations.
The world’s largest brewer by volumes reported a 10.2% rise in second-quarter normalised earnings before interest, tax, depreciation and amortisation (ebitda), surpassing analysts’ forecast for growth of 8.3%.
Investors see the period as a return to normality for the maker of Budweiser and Stella Artois, after years of issues caused by Covid-19, inflationary pressures and a prolonged boycott of key brand Bud Light in the US, whose effect is now fading.
“We are encouraged with our performance in the first half of the year and remain focused on consistent execution of our strategy,” CEO Michel Doukeris said.
AB InBev’s volumes and revenues lagged forecasts, with volumes down 0.8% and revenues up 2.7%. Analysts had expected a decline of 0.6% and an increase of 3.5%, respectively.
The company retained its full-year outlook for 4%-8% core profit growth — a decision that could disappoint some, given the strong results across the first half of the year, Brett Cooper, managing partner at equity research firm Consumer Edge, said.
“Concerns will likely rest with the volume and revenue miss ... and the lack of a profit upgrade,” he said, adding that AB InBev’s results were still solid against generally weak results for alcohol peers.
Shares of Heineken, the world’s second-largest brewer, fell more than 9% on Monday after the company said an expected sales boost had not materialised due to bad weather.
AB InBev said it too was affected by bad weather in key parts of its geographic footprint in China, driving down revenue and volumes in the country by 15.2% and 10.4%, respectively.
In Argentina, a surge in inflation has put pressure on consumers and beer sales. AB InBev said its volumes declined by more than 20% in the second quarter.
The company also saw its revenue fall 0.6% in the key US market, where the boycott of Bud Light knocked the brew from its top spot as the nation’s best-selling beer.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
AB InBev exceeds second-quarter profit expectations
Beer giant reports forecast-beating core profit but revenue and volumes disappoint
London — Beer giant Anhueser-Busch InBev reported on Thursday forecast-beating core profit for the second quarter, but its revenue and volumes fell short of expectations.
The world’s largest brewer by volumes reported a 10.2% rise in second-quarter normalised earnings before interest, tax, depreciation and amortisation (ebitda), surpassing analysts’ forecast for growth of 8.3%.
Investors see the period as a return to normality for the maker of Budweiser and Stella Artois, after years of issues caused by Covid-19, inflationary pressures and a prolonged boycott of key brand Bud Light in the US, whose effect is now fading.
“We are encouraged with our performance in the first half of the year and remain focused on consistent execution of our strategy,” CEO Michel Doukeris said.
AB InBev’s volumes and revenues lagged forecasts, with volumes down 0.8% and revenues up 2.7%. Analysts had expected a decline of 0.6% and an increase of 3.5%, respectively.
The company retained its full-year outlook for 4%-8% core profit growth — a decision that could disappoint some, given the strong results across the first half of the year, Brett Cooper, managing partner at equity research firm Consumer Edge, said.
“Concerns will likely rest with the volume and revenue miss ... and the lack of a profit upgrade,” he said, adding that AB InBev’s results were still solid against generally weak results for alcohol peers.
Shares of Heineken, the world’s second-largest brewer, fell more than 9% on Monday after the company said an expected sales boost had not materialised due to bad weather.
AB InBev said it too was affected by bad weather in key parts of its geographic footprint in China, driving down revenue and volumes in the country by 15.2% and 10.4%, respectively.
In Argentina, a surge in inflation has put pressure on consumers and beer sales. AB InBev said its volumes declined by more than 20% in the second quarter.
The company also saw its revenue fall 0.6% in the key US market, where the boycott of Bud Light knocked the brew from its top spot as the nation’s best-selling beer.
Reuters
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