Despite the aftermath of a US riot and perennially expensive pints, AB InBev is starting the year better than expected. Both revenue and profit are up more than hoped for.
Volume still down
The first quarter ends for AB InBev with 2.6% more revenue and 5.4% more EBITDA (accounting for $4.99 billion or 4.64 billion euros). The profit margin rose 90 basis points to 34.3%. However, volumes were again down slightly by 0.6%. The growth was thus entirely due to price increases and cost savings.
Own beer volumes actually fell 1.3%, while non-beer volumes sold climbed 3.5%. Analysts, however, feared a bigger volume decline and, like CEO Michel Doukeris, called the results ‘encouraging as a start to the year’.
Corona on the menu
North America in particular is showing the first signs of recovery, following a marketing stunt that backfired and has been haunting the brewing group for a year now. When transgender influencer Dylan Mulvaney received a personalised can of Bud Light, conservative America promptly turned against the brand and the lager instantly lost market leadership in the US. Today, Bud still loses to rival Modelo Especial, but the decline is shrinking.
In Europe, AB InBev is seeing margin recovery courtesy of pricing actions and continued premiumisation. Premium and super-premium brands now account for around 56% of revenues. The brewing giant also wants to rid beer brand Corona of its viral connotation by making Corona Cero sponsor of the Olympics.
