BRAZIL: AmBev poised for unparalleled growth but international expansion key
AmBev, Brazil's largest brewer, and fourth largest brewer in the world, is poised to benefit from growth unmatched by any other brewer in the world, according to a report from a leading investment bank. AmBev recently posted a 70% increase in year-on-year earnings before interest, taxes, depreciation and amortisation (ebitda). And deutsche Bank in a recent report said: "We view the (third) quarter as an appetiser - we are excited about what is yet to come. Which brewer is poised to grow its ebitda like AmBev over the next two years? No one in our opinion."The merger between Antarctica and Brahma, formerly the country's leading brewers, that created AmBev is set to deliver synergy gains that will total $250m annually as of next year.Furthermore, Brazil is one of the fastest growing beer markets in the world.However some doubts still remain over the brewer's ability to capitalise on the international market, essential if it is to deliver growth in the long term. A recent article in the UK's Financial Times said: "With all but 3.4% of AmBev's 76.4m hectolitre sales for 1999 originating in Brazil, in the long run, the combined company will have to expand internationally to create additional value and diversify its risk, analysts say."The acquisition in September of Salus, Uruguay's number two brewer, is an indication of AmBev's intent to move outside its traditional Brazilian borders. However as most of the markets in South America are family-owned companies it makes it difficult to grab market share and growth is likely to be slow.The Salus acquisition, for example, only brought an extra 190,000 hectolitres to the AmBev stable, less than 0.3% of the company's total production.
Get full access to all content, just $1 for 30 days
A Message From The Editor
just-drinks gives you the widest beverage market coverage.
Paid just-drinks members have unlimited access to all our exclusive content - including 15 years of archives.
I am so confident you will love complete access to our content that today I can offer you 30 days access for $1.
It’s our best ever membership offer – just for you.
Olly Wehring, editor of just-drinks
- What do A-B InBev results mean for SABMiller deal?
- Interview - Beam Suntory's EMEA president
- Interview - William Grant & Sons
- Spirits - Where does 'Craft' End and 'Mass' Begin?
- Anheuser-Busch InBev's FY Performance by Region
- Tesco reinstates Dan Jago following suspension
- Diageo "smart bottle" targets consumers at home
- Diageo completes Don Julio, Bushmills swap deal
- Pernod Ricard sends Martell Mumm PJ head to Asia
- Pernod Ricard's Havana Club Union
- Global non-Scotch whiskies insights - market forecasts, product innovation and consumer trends research
- Wine, 2014 and the future
- Spirits and RTDs, 2014 and the future
- Beam Suntory Inc. - Strategy and SWOT Report
- Global RTD/RTS insights - market forecasts, product innovation and consumer trends research