Analysis - US job losses hit Europe's brewers
Beer volumes dropped in the US
Europe's big brewers saw their volumes in the US drop back in the first three months of the year as unemployment among young men hurt sales, an analyst has said.
Bernstein analyst Trevor Stirling said in a note today (14 May) the US beer market had a “very weak” Q1 after 2012's strong performance. Bad weather was partly to blame for industry volumes falling about 3%, but increasing job losses in beer's key demographic was an underlying cause, Stirling said.
He also said consumer confidence is fragile, damaged by higher payroll taxes.
In Heineken's Q1 results, released last month, group beer volumes in the Americas declined by 2.4% with sales to US retailers declining in the low-single digits. Over the same period, Anheuser-Busch InBev saw US sales-to-wholesalers fall by 5.2%.
The note, part of Bernstein's quarterly sector review of the European alcohol industry, said despite economic problems, margins in the US remained strong because of growth in craft beer and “premium” sales.
Stirling said a “marked slowdown” in Cognac and Scotch sales in China in the first-quarter caused by a crackdown on conspicuous consumption at government events is likely to lessen throughout the year.
In Q1 figures released in April, Rémy Cointreau admitted “more modest” growth for its Cognac labels in China, while in a call with analysts today, Diageo's Asia-Pacific head warned that the country's sales will remain “soft” for the rest of the year.
China's beer volumes, however, rebounded in the first three months of the year, though margins remained small, Stirling said.
Asia Pacific Breweries is Heineken’s joint venture in Singapore, with a variety of brands and consumer beverages that enjoy prominence in their local markets. The venture is crucial to the firm's grow...
This is the first in a new series of short reports from just-drinks. These profiles will bring together all of just-drinks' coverage of a major development involving some of the leading players in the...
Heineken, the world’s third largest brewer and leading cider producer, continued its aggressive acquisitive expansion in 2012 with the purchase of Asia Pacific Breweries. This profile considers the ex...
Heineken is expected to place a strong emphasis on building an environmentally-friendly business during the forecast period. The company’s sustainability plan, Brewing a Better Future, states that the...
- just The Preview - Diageo's FY preliminaries
- Analysis - SABMiller's Australian issues continue
- Focus - SABMiller's Q1 Performance by Region
- PepsiCo to consider more re-franchising - CEO
- PepsiCo find stability but Peltz concerns linger
- Diageo silent over Shuijingfang writedown report
- Diageo's Captain Morgan Facebook ad banned
- Sales, profits fall at Moet Hennessy in H1
- Champagne Nicolas Feuillatte appoints new CEO
- Molson Coors CEO to retire