GLOBAL: "Challenging" UK, US but InBev still up in Q2
InBev has reported a strong showing in its second quarter, despite "challenging conditions" in both the UK and US.
The Belgium-based brewer said today (30 August) that operating profit for the three months to the end of June leapt by 19.8% on the corresponding quarter a year earlier, reaching EUR964m (US$1.31bn). Sales in the period rose by 7.6% in value terms to EUR3.7bn, and by 5% in volume terms to 68m hectolitres.
Net profit in the quarter was up by 21% on Q2 2006, hitting EUR477m.
In Western Europe, volumes in the quarter slipped by 4%, with UK volumes down by a more marked 10.7%. Germany saw volumes fall by 2.2%. Shipments to North America were down by 2.6%, while Canadian volumes fell by 3.1%. Meanwhile, Latin America North (+3.5%), Latin America South (+10.1%), Central & Eastern Europe (+15%) and Asia Pacific (+3.5%) more than made up for the former two regions.
In terms of brands, InBev saw its global names bring in volume growth of 2.7% year-on-year in the quarter. Volume growth for Brahma and Beck's was partially offset by a weak performance by Stella Artois in the UK, the company conceded.
"The second quarter has shown improvement in our overall business," said company CEO Carlos Brito. "But we can do better. We have higher expectations for our China and UK operations. In those operations, we have been outperformed by competitors and we must do better. The way to get back on track in these geographies is to continue to enhance our people capabilities, brand equity and in-market execution, thus building a sustainable and profitable platform for our businesses to grow."
The company has set itself the long term objectives of achieving organic volume ahead of industry growth, revenue growth above volume growth, while managing costs below inflation and constantly ensuring that resources are optimally deployed. "The company continues to see opportunities for further margin expansion and value creation," InBev concluded.
Separately, InBev said it will begin a EUR300m share buyback programme, which will run until October next year.
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