first_imgAnheuser-Busch sees revenue climb 3.6% despite hit to volumePosted By: Alex Clereon: October 26, 2017In: Alcohol, Beverage, Business, Financial, IndustriesPrintEmailAnheuser-Busch saw its third-quarter revenue increase by 3.6% to reach $14.74 billion, despite the ‘substantial impact’ of adverse weather conditions.Revenue per hectolitre grew 5%, helping to offset a 1.2% decline in volume during the quarter. Like Dr Pepper Snapple, it blamed hurricanes and earthquakes in North America – as well as a weak Brazilian market – for the loss in volume, which was only partially balanced by continued growth in Mexico, Argentina and Africa.Pre-tax earnings rose 13.8% to $5.73 billion, while net profit was higher at $2.58 billion.“Our business continued to deliver solid results this quarter,” said Anheuser-Busch CEO Carlos Brito. “Revenue grew by 3.6%, driven by revenue management and premiumisation initiatives enhanced by our three global brands’ performances, especially outside of their home markets.“Our EBITDA growth rate accelerated, up by 13.8% in the third quarter and by 10.7% in the first nine months, driven by solid top-line growth and disciplined cost management including synergy capture.“As we enter the final months of the year, we will continue to push ourselves toward a strong finish. We have plenty of opportunities ahead of us, and look forward with excitement to further building on our dream of bringing people together for a better world.”The company expects to deliver further synergies from its merger with SABMiller, which closed a year ago, and has revised its savings forecast upwards from $2.8 billion to $3.2 billion. It realised synergies and cost savings of $336 million in this quarter alone.By metricRevenue: $14.74 billion (+3.6%)Volume: 161 million hectolitres (-1.2%)Margin: 38.9% (+353 basis points; about 3.5%)Profit:$5.73 billion EBITDA (+13.8%)By regionNorth America: Total volumes fell 6.1%, with revenue down 5.3% to $4.12 billion. In the US, AB’s ‘above premium’ portfolio accelerated this quarter, gaining market share. Michelob Ultra grew volumes by double-digits and was the top share gainer in the US for the tenth consecutive quarter, achieving the highest quarterly share gain in the past five years. Stella Artois had another strong quarter, as one of the top three fastest-growing import brands. The company’s craft portfolio also continued to gain share. Its ‘premium’ and ‘premium light’ brands were less successful, with Budweiser and Bud Light in particular losing ground despite the commencement of heavy marketing activity for both. In Canada, a softening beer industry led to low-single-digit volume decline, but market share performance continued to prove solid and, north of the border, Bud Light actually showed positive momentum. As in the US, AB saw continued growth in its high end segment in Canada, with both the craft portfolio and Stella Artois brand gaining share.Latin America: Volume grew on the whole, despite a 3.5% fall in total volumes in AB’s Latin America North reporting region. Its business in Mexico continued to perform well in the quarter, with double-digit revenue growth driven by higher volumes and higher revenue per hectolitre. Victoria and Corona Extra each secured growth in the core segment, while Bud Light and the Modelo Family converted high consumer engagement on special occasions into volume growth in the core plus segment. In Brazil, revenue grew 8.6% thanks to revenue-per-hectolitre growth of 13.1% and in spite of volume decline totalling 4%. Beer volumes were down by 5.4% in the quarter, impacted by an industry that is still in recovery. In Colombia, revenue growth of 6.7% was attributed to gains in non-alcoholic beverages, and not in beer, which lost around 1.4% of volume. The country’s macroeconomic environment remains challenging with consumer confidence and real disposable income under continued pressure, AB said. Elsewhere, there was growth in both Argentina and Peru.EMEA: Volume decline was nominal, and indeed AB reported ‘another solid quarter’ in Western Europe, achieving market share gains in most markets. The UK continued to deliver double-digit top-line growth, resulting from a strong commercial performance. In Eastern Europe, revenues declined by low single digits, driven by the ongoing headwind of the large PET ban in Russia. Its global and premium brands continued their strong growth.Africa: Beer revenues grew in South Africa by 3.9%, with per-hectolitre growth of 6.6% helping to offset volume decline. The high-end portfolio continued to deliver strong growth in Stella Artois and Corona, and AB recently began seeding Budweiser into the market to complete its global brand portfolio in the country. Castle Lite performed well this quarter with volumes growing by double-digits, as the brand focuses on growing the in-home consumption occasion heading into summer. Flying Fish also continues to perform extremely well, targeting mixed gender occasions and launching “Flying Fish Chill” in September, the first light flavoured beer in South Africa. Elsewhere on the continent, own beer volumes grew in the mid-teens, fuelled by good growth in Nigeria, Tanzania, Uganda, Mozambique and Zambia.Asia-Pacific: Both total volume and own-beer volume held steady, recording nominal growth. Revenue in China grew by 4.6% in the quarter with continued premiumisation driving revenue-per-hectolitre growth of 4.8%, despite slightly lower volumes of 0.2%, which were driven by industry headwinds concentrated in the northeastern and southern provinces. Budweiser continued to excel in China, while the ‘super premium’ portfolio – led by Corona, Hoegaarden, and Franziskaner – grew by high double digits. Australia continues to see strong performance, led by the Great Northern franchise, and AB became the number one cider player in Australia over the past 12 months thanks to growth in Pure Blonde cider and Mercury hard cider. The company continues to grow its craft portfolio, including the acquisition of 4 Pines Brewery announced last month. 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