AB InBev first-quarter revenue rises 6.2%, benefits from strong double digit performance in Nigeria

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World’s biggest brewer AB InBev scraps dividend despite growth in revenue in Q3

The world biggest brewer, Anheuser-Busch InBev (AB InBev), reported a 6.2 per cent increase in revenue for the quarter to end June, boosted by its global brands, Budweiser, Stella Artois and Corona.

AB InBev reported a 5.3 per cent growth in the fourth quarter of last year.

AB InBev said revenue increased to $13.9 billion for the quarter to end June, up from $13.8bn compared to last year, while net profit increased to $2.8bn, from $2.2bn.

Best quarterly volume performance in over five years with total growth of 2.1%, driven by strong performances in many of its key markets including Mexico, Brazil, Europe, South Africa, Nigeria, Australia and Colombia.

Combined revenues of its three global brands, Budweiser, Stella Artois and Corona,
grew by 8.0% globally, and by 11.3% outside of their respective home markets. In HY19, the combined revenues of global brands grew by 8.2% globally and by 12.4% outside of their home markets.

In Africa excluding South Africa, Nigeria continues to lead the way with double-digit revenue and volume growth fueled by our core portfolio as well as Budweiser in the premium segment. Our beer volumes in Tanzania returned to growth this quarter with good performances across our portfolio. Volumes in Mozambique declined by mid-teens following the effects of a devastating tropical cyclone earlier in the year.

Revenue grew by 6.2% in the quarter, with revenue per hl growth of 3.8%, driven by healthy volume growth, global premiumization and revenue management initiatives. In HY19, revenue grew by 6.0%, with revenue per hl growth of 4.2%.

MANAGEMENT COMMENTS

In 2Q19, we achieved our best volume performance in more than five years, contributing to a strong topline and EBITDA performance. Revenue grew by 6.2% driven by volume growth of 2.1% (own beer +2.2%, non-beer +1.8%) and revenue per hl growth of 3.8%, in line with our guidance for more balanced top-line growth.

We delivered volume growth across most of our major markets, with especially strong results from Mexico, Brazil, Europe, South Africa, Nigeria, Australia and Colombia, with some of these markets also benefiting from the later timing of the Easter holiday. We achieved this broad-based growth despite a difficult comparison, as we were lapping the impact of our 2018 FIFA World Cup RussiaTM sponsorship, our largest commercial activation in history. We saw healthy revenue growth across our key markets, led by Mexico, Brazil, China, Europe and the US.

Premiumization remains a significant opportunity and a critical component of our strategy to deliver the sustainable top and bottom-line growth. We continue to lead the way globally with our unparalleled portfolio of premium brands, as we believe premiumization requires a portfolio approach to meet consumer needs.

Our High-End Company continues to be a growth engine, growing revenues by 19.5% in the quarter. Our global brands grew revenues by 8.0% and by 11.3% outside of their home markets. Budweiser grew by 5.6% outside of the US, Stella Artois increased by nearly 12% and Corona was up 23.7% outside of Mexico. Budweiser, which drove extensive scale and reach with the Men’s 2018 FIFA World Cup Russia, continued to support the world’s best football by leveraging the Women’s 2019 FIFA World Cup FranceTM in many of our markets. Additionally, Budweiser announced a multi-year sponsorship with two of the top international football leagues, the Premier League and LaLiga. These new sponsorships will activate across five continents and in more than 20 countries.

As a long-time partner of the FIFA World Cup™ and supporter of football leagues and several national teams worldwide, Budweiser is expanding its support for the world’s game and continues to connect to more football fans. As a reminder, in FY18 our sales and marketing investments were weighted toward the first half of the year due to the 2018 FIFA World Cup RussiaTM activation. In FY19, we expect that our sales and marketing investments will be much more balanced throughout the year, resulting in a more difficult
comparable in the second half of 2019, particularly in the third quarter.

 

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