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01/10 16:56
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary highlights strong financial performance, strategic investments in brand growth, and positive market strategies, particularly in the U.S. and China. The Q&A section reveals optimism for future growth, especially in developing markets and Beyond Beer categories. While management was vague on some cost specifics, the overall sentiment remains positive due to strong brand performance and strategic initiatives. Therefore, a 'Positive' rating is appropriate.
Revenue per hectoliter Increased by 4.8%, resulting in top-line growth of 0.9%. This was driven by disciplined revenue management choices and a portfolio of mega brands commanding premium prices.
EBITDA Increased by 3.3% with margin expansion of 85 basis points. Productivity initiatives offset transactional FX headwinds.
Revenue in North America Revenue in Beyond Beer increased in the mid-40s, led by Cutwater, which grew revenue in the triple digits. Michelob Ultra gained market share in all 50 states and became the largest brand year-to-date in both on and off-premise channels.
Revenue in Middle Americas Revenue in Mexico grew due to disciplined revenue management choices, despite a softer consumer environment and unseasonable weather. In Colombia, record high volumes drove low teens top-line and mid single digits bottom-line growth. In Brazil, revenue declined by 1.9% due to unseasonable weather and a softer consumer environment, but market share gains and cost management offset the decline.
Revenue in Europe Flattish volumes and margin recovery were driven by continued market share gains and premiumization. Share of the industry increased in five of six key markets.
Revenue in South Africa Top-line grew by mid single digits and EBITDA grew by high single digits with margin expansion, maintaining share of beer and gaining share of Beyond Beer.
Revenue in China Declined by 15.2% due to a soft consumer environment and underperformance in key channels. Efforts are being made to enhance execution and align results with capabilities.
Non-alcohol beer revenue Grew by 27%, led by the growth of Corona Zero. The company gained share in 70% of its top 14 non-alcohol beer markets.
BEES marketplace GMV Quarterly GMV reached nearly $1 billion, a 66% increase versus last year, with more than 500 partners on the platform.
Underlying EPS Delivered $0.99 per share, a 1% increase in U.S. dollars and a 0.3% increase in constant currency versus last year. EBITDA growth contributed to the increase, partially offset by higher financial costs due to FX movements and hedging.
Michelob Ultra Zero: Launched early this year, it is already the second largest non-alcohol beer brand and the fastest growing non-alcohol beer in the industry.
Cutwater: Achieved triple-digit revenue growth and is now one of the top 10 largest spirits brands in the U.S.
Corona Zero: Led non-alcohol beer portfolio growth with a 27% increase in net revenue.
Phorm Energy: Launched to participate in the energy drink segment.
U.S. Market: Michelob Ultra gained market share in all 50 states, becoming the largest brand year-to-date in both on and off-premise channels.
Mexico: Volumes returned to growth in August and September after a decline due to unseasonable weather and softer consumer environment.
China: Revenue declined by 15.2% due to a soft consumer environment and underperformance in key channels. Efforts are underway to reignite growth through investments in mega brands and improved execution.
Revenue Management: Disciplined revenue management choices and premium pricing drove a 4.8% increase in revenue per hectoliter.
BEES Marketplace: Quarterly GMV reached nearly $1 billion, with a 66% increase versus last year.
EBITDA Margins: Improved by 85 basis points, with expansion in four of five operating regions.
Share Buyback Program: Announced a $6 billion share buyback program to be executed within 24 months.
Interim Dividend: Declared an interim dividend of EUR 0.15 per share, the first since 2019.
Debt Management: Redeemed $2 billion in bonds, leaving no bonds maturing through 2026.
Dynamic operating environment: Headwinds in China and unseasonable weather in the Americas, particularly in Brazil, constrained results.
China market performance: Revenue declined by 15.2% with volumes underperforming the industry due to a soft consumer environment and execution challenges.
Unseasonable weather: Negatively impacted volumes in key markets like Brazil and Mexico, affecting overall performance.
Cyclical factors in Latin America: Inflationary pressures and low consumer sentiment impacted demand for beer and other consumer categories.
FX headwinds: Transactional foreign exchange headwinds impacted financial performance.
Soft consumer environment in key regions: Affected demand in markets like China and parts of Latin America.
Execution challenges in China: Opportunities to enhance execution and route to market to better align results with capabilities.
Volume performance: Overall volumes were below potential, impacting revenue growth.
Revenue and EBITDA Growth Outlook: The company remains confident in delivering its 2025 outlook of 4% to 8% EBITDA growth. Revenue growth is expected to be driven by disciplined revenue management, premiumization, and efficient operations.
Capital Allocation Plans: AB InBev announced a $6 billion share buyback program to be executed within the next 24 months and an interim dividend of EUR 0.15 per share. The company also plans to redeem $2 billion in outstanding bonds, with no bonds maturing through 2026.
Market Expansion and Innovation: The company plans to increase investments in mega brands, lead innovation in packaging and liquids, strengthen its route to market in in-home channels, and expand geographically, particularly in China. It also aims to grow its non-alcohol beer and Beyond Beer portfolios.
Digital Transformation: The BEES marketplace is expected to continue its growth trajectory, with quarterly GMV approaching $1 billion. The company is also expanding its direct-to-consumer digital platforms, which generated $138 million in revenue this quarter.
FIFA World Cup 2026 Activation: AB InBev plans to leverage the FIFA World Cup in North America in 2026 as a major opportunity to activate the beer category, with 104 games across three countries providing significant consumer engagement opportunities.
Interim Dividend: The Board has approved an interim dividend of EUR 0.15 per share, marking the first interim dividend since 2019.
Share Buyback Program: The Board has approved a $6 billion share buyback program to be executed within the next 24 months.
The earnings call summary highlights strong financial performance, strategic investments in brand growth, and positive market strategies, particularly in the U.S. and China. The Q&A section reveals optimism for future growth, especially in developing markets and Beyond Beer categories. While management was vague on some cost specifics, the overall sentiment remains positive due to strong brand performance and strategic initiatives. Therefore, a 'Positive' rating is appropriate.
The earnings call summary highlights strong financial performance, product innovation, and strategic growth plans. Despite some concerns in markets like Brazil and China, management's confidence in medium-term growth, margin improvements, and strategic event activations indicates a positive outlook. The Q&A session reinforced this sentiment with plans for leveraging major events and focusing on high-growth brands. Given the overall positive tone, strong financial metrics, and optimistic guidance, the stock is likely to experience a positive movement in the coming weeks.
The earnings call highlights strong financial performance with record revenue, improved EBITDA margins, and increased shareholder returns via a $1 billion buyback. Despite challenges in China and competitive pressures, the company is optimistic about future volume growth and market strategies, particularly in the U.S. and Mexico. The Q&A session reinforces confidence in long-term growth and strategic investments, with positive analyst sentiment. The positive financial metrics and optimistic guidance suggest a positive stock price movement in the short term.
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