By Jennifer Creery.
Anheuser-Busch InBev offset a slump in volumes in western markets with growth in Africa and South America, alongside stronger sales of premium beer products.
The world’s largest brewer said Thursday overall volumes fell 1.5% in the fourth quarter, less than analysts expected.
The more upbeat update comes just a day after rival Heineken NV surprised the market by announcing plans to cut up to 6 000 jobs — about 7% of its workforce — as it copes with an industrywide slump in beer demand.
Consumers worldwide are pulling back on their drinking following concerns over affordability and the negative health impacts of consuming alcohol. Peers Heineken, whose Chief Executive Officer Dolf van den Brink is on the way out, and Carlsberg A/S both cited uncertainty as the one of the main reasons for their weaker forecasts this year.
AB InBev maintained its medium-term outlook of earnings before interest, tax, depreciation, and amortisation growth of between 4% and 6%.
While sales were hit in traditional strongholds, the company reported record-high beer volumes in Colombia last year. Sales of premium beer Corona led double-digit volume growth in 30 markets, the company said.
Like its rivals, AB InBev has been expanding its non-beer category with products such as Cutwater Spirits. Volumes were up 0.6% in the fourth quarter, however, though beer accounts to account for the bulk of overall volumes.
AB InBev has faced challenges in critical markets, including China, where a government crackdown on corporate hospitality and a shift toward at-home drinking has hurt sales. Unseasonably poor weather, particularly in Brazil, which had a negative impact on AB InBev’s performance last year, normalised in the final quarter, the company said.