AB InBev Q1 revenues grow 5.9% with double digit volume growth in Brazil

EUROPE – Anheuser-Busch InBev (AB InBev), world’s leading beer producer has reported strong performance, having registered 5.9% growth in revenues to US$12.59 billion during the first quarter.

The period was strongly supported by Brazil, which registered double digit volume growth in both beer and non-beer businesses.

EBITDA increased by 8.2% to US$4.99 billion boosted by premiumization strategy supporting top and bottom-line growth while, total volumes grew by 1.3%, with own beer volumes up 1.0% and non-beer volumes up 4.9%.

AB InBev said the period saw continued market share improvement in the US led by premiumisation and innovation initiatives.

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Top-line result was driven by healthy performances in several of our key markets, including Brazil, China, the US, Europe, Colombia and Nigeria offset by softer volume results in South Africa and Argentina where macroeconomic conditions remain challenging.

Recent innovations in Brazil such as Skol Puro Malte and its affordable beers brewed with local ingredients such as Nossa and Magnífica, contributed significantly to growth while premium segment recorded gain in market share.

“We continue to improve our performance in the US as the result of an evolved commercial strategy focused on premiumization and innovation,” said the company.

“Leveraging the momentum built throughout last year, top-line growth in Q1 2019 was supported by our best market share trend performance in the past 25 quarters with an estimated market share decline of only 10 bps.”

“Globally, top-line and bottom-line performance continues to benefit from positive brand mix driven by the growth of our unparalleled portfolio of premium brands.

“Our global brands grew revenues by 8.5% and by 14.0% outside of their home markets, while our High-End Company grew revenues by 19.9%.”

The company said it is on track to deliver its ambitious 2025 sustainability goals launched in March 2018, having reduced carbon emission across its value chain by 4.5% over the last year.

The company also announced it is exploring a potential minority stake listing of its Asia Pacific (APAC) business on the Hong Kong stock exchange.

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According to the company, its superior portfolio of brands and leadership position in the beer industry provide an attractive platform for potential M&A in the region.

AB InBev saw the combined revenue of its three global brands – Budweiser, Stella Artois and Corona – grow by 8.5% globally, and by 14% outside of their respective home markets.

In China, revenue for the quarter was up 7.8% as Budweiser posted mid-single-digit volume growth while beer brands Corona, Franziskaner and Hoegaarden also performed well.

Revenue declined by mid-single digits in South Africa, in part due to lower consumer demand and the later timing of the Easter holiday.

In Mexico, revenue grew by low single digits led by premium portfolio especially Michelob Ultra with growth of more than 30% and Stella Artois with growth of more than 80%.

In Argentina, which reached a three-year cumulative inflation rate greater than 100%, premium brands, led by Stella Artois, Corona and Patagonia, performed well.

AB InBev expects to deliver strong results in 2019, driven by strong commercial plans, best-in-class portfolio of brands, diverse geographic footprint, unparalleled operating efficiency.

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