Vulnerable AB InBev dodges bullet
Kraft Heinz woes show the brewer has a long way to go to reduce debt and justify goodwill of $133bn on its balance sheet
It isn’t quite last orders for AB InBev. But neither has it seen the bill. The company said on Thursday that sales growth improved in the final quarter of its financial year and forecast a further escalation in 2019. The world’s biggest brewer said it expected strong expansion in both revenue and ebitda. The more upbeat performance is a stark contrast with recent announcements. In the third quarter the company missed profit expectations and halved its dividend. The US, one of its biggest markets, contributed to the improvement. Although sales are still declining, the company is ceding less market share. There was strength in some other key locations, including Mexico and China, offsetting weakness in Brazil and SA. The shares rose as much as 6%. But investors may be getting ahead of themselves. First, the company is still lumbering under a substantial pile of borrowings from its 2016 acquisition of SABMiller. True, it is taking action here: net debt fell over the second half from $1...
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