AB InBev 2Q Net Profit Surged as Sales Recovered -- Update
29 July 2021 - 10:50PM
Dow Jones News
By Adria Calatayud
Anheuser-Busch InBev SA said Thursday that net profit for the
second quarter rose sharply as sales exceeded pre-pandemic levels,
but the Budweiser brewer said it continues to absorb cost headwinds
from tight supply chains in the U.S.
The world's largest brewer, which also houses the Stella Artois
and Michelob Ultra brands in its portfolio, said quarterly net
profit was $1.86 billion compared with $351 million for the
year-earlier period, when its performance was hurt by an impairment
charge against its African business.
Belgium-based AB InBev said revenue for the quarter increased to
$13.54 billion from $10.29 billion a year before. Organic revenue
growth for the quarter was 28%, while organic volumes rose 21%.
This compared with expectations for increases of 24% and 19%,
respectively, according to a company-provided consensus.
AB InBev said its top-line grew 3.2% compared with the second
quarter of 2019.
Normalized earnings before interest, taxes, depreciation and
amortization for the quarter increased 31% on an organic basis,
missing company-provided expectations for a 35% rise. AB InBev's
normalized Ebitda fell in the key U.S. and Brazil markets.
The company said second-quarter momentum and cost discipline
were partially offset by anticipated transactional foreign-exchange
and commodity headwinds, resulting from the effect of currency
devaluations in Mexico and Brazil last year. In the U.S., earnings
were hurt by elevated costs, as the company continued to absorb
headwinds created by tighter supply chains, it said.
Shares at 1206 GMT were down 6.1% at 54.56 euros ($64.62).
The company reiterated its guidance for normalized Ebitda growth
of between 8% and 12% for 2021 as a whole, with revenue growth
ahead of that range.
Chief Financial Officer Fernando Tennenbaum said costs of raw
materials like aluminum and barley are rising, but that AB InBev's
hedging policy gives it time to react and look for ways to mitigate
the hit. The company will decide whether to pass higher costs on
through prices at a local level, he said.
"There are some cost pressures, but it's not a surprise. We were
prepared for it and are trying to find ways to mitigate it," Mr.
Tennenbaum said in an interview.
Write to Adria Calatayud at adria.calatayud@dowjones.com
(END) Dow Jones Newswires
July 29, 2021 08:38 ET (12:38 GMT)
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