China tilts towards high-end beer growth - Anheuser-Busch InBev CEO
Corona Extra is one of AB InBev's super premium brands in China
Anheuser-Busch InBev's CEO has said he expects his beers to buck declines in China as the country's premium segment races ahead of "blue-collar" brands.
Carlos Brito said China's overall beer market volumes sank by 6% last year as economic concerns hit consumer demand. However, he said "averages can be misleading" and the super-premium category jumped by 18%, while the premium category was up 9%.
More than half of AB InBev's volumes in China are in the above-core category, with brands such as Corono Extra, Stella Artois and Harbin Ice. In full-year results released yesterday, AB InBev's China unit posted flat volumes but a 10% sales lift. The combined volumes of core+, premium and super premium brands grew by double digits in the year.
Brito said: "We think that the blue-collar consumer is under pressure [in China], not the service sector type consumer, that's why in our opinion value and core segments are down. But core+, premium, super premium are up, and we're very happy to see that our business is more skewed towards those segments that are growing."
Despite his optimism over China, Brito admitted that the market will remain challenged in 2016. He also voiced concerns over Brazil, where a recession has dampened consumer demand.
"Brazil is having a tough time," Brito said. "I mean they had a tough time in 2015. We're saying it's going to be a tough year in 2016."
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