Belgian brewery group AB InBev is "not satisfied with our top line performance (regarding volume and profits) in 2013, which continues to be impacted by macroeconomic headwinds in a number of our markets". The brewer did manage to generate a third quarter turnover 14.2 % higher than last year, but those numbers are being influenced by Corona’s purchase.
(Nearly) no growth without Corona
AB InBev’s worldwide third quarter turnover was 11.729 billion dollars (8.5 billion euro), outshining last year’s third quarter by some 14.2 %. However, if Corona’s purchase is taken out of the equation, the numbers would only have increased 0.9 %.
The spike is mainly due to higher prices: the like-for-like volume barely rose, coming from 119.638 million hectoliter in 2012’s third quarter to 119.664 million hectoliter this year. Profits increased by more than 30 %, from 1.818 to 2.366 billion dollars (1.3 to 1.7 billion euro).
A decreased cost for all sold items, a 0.3 % drop per hectoliter in the third quarter, led to the stronger profit growth. Synergizing several units at Mexican Grupo Modelo (Corona), meant AB InBev could decrease overall costs, leading to more profit.
American and Brazilian drops
Despite this increased profit, AB InBev’s management was not entirely satisfied as its two most important beer markets, Brazil and the United States, did not consume as much as last year. In the United States, the brewer had increased its prices, trying to close the gap between its luxury and sub-luxury brands. That meant it lost 0.8 % market share in the third quarter, while Brazil’s high inflation perturbed that specific market.
The West European beer consumption grew 0.1 %, thanks to a good summer. Considering the first 9 months of 2013, AB InBev managed to limit the loss in sales of its own brands to 4.6 %. The Belgian beer market recovered, with a 0.4 % increase in sales of its own brands, resulting in a market share growth. In China, an important market for AB InBev, the company sold 8.3 % more beer in the third quarter.
AB InBev estimates that the full-year volumes will remain stable or have a slight setback, with continued pressure on the Brazilian volumes and continued growth on the Chinese market.
(translated by Gary Peeters)