BELGIUM: Western Europe fails to dent InBev Q1 leap
InBev has posted a strong lift in profits for its first quarter.
The global brewer said today (10 May) that net profit for the first three months of this year leapt by 69% year-on-year, reaching EUR280m (US$378.8m). Revenues rose 8.9% to EUR3.05bn from EUR2.79bn.
While total beer volumes for the brewer grew by 6.7% year-on-year, however, volumes in Western Europe slipped by 1.1% to 7.57m hectolitres. InBev said performance in the region was impacted by an expected increase in cost of sales, but was nearly able to offset this with solid fixed cost management.
North American shipments also disappointed, dropping 2.3% in the quarter, although the company highlighted a lower European import performance in January, ahead of the transition to the new joint-venture with Anheuser-Busch in the US. A strong cost discipline remains in place "to ensure an efficient operation", the brewer noted.
Latin America North drove additional margin expansion by delivering against objective on both the top and bottom lines. Latin America South also performed well, thanks to a combination of a strong revenue increase and limited cost growth. In Central & Eastern Europe, margins grew as a result of volume increases and focusing cost increases. Margins in Asia Pacific benefited from higher volumes at a more profitable country mix, as well as "strict cost management", InBev said.
"This first quarter confirms our commitment to continue to grow and build our business along the following principles: grow volumes ahead of the industry, grow top line ahead of volume and manage costs below inflation. EBITDA margin was further expanded across all zones with the exception of Western Europe, where top line growth remains a challenge for us. Latin America North, Latin America South and Central & Eastern Europe all had very good performances in this quarter", said Carlos Brito, InBev's CEO.
Going forward, the brewer said it was unchanged in its objectives of achieving organic volume growth ahead of the industry, revenue growth above volume growth, while keeping strong cost management. "The company will concentrate on capturing the full benefit of its presence in faster growing markets, while taking the actions necessary to improve our performance in more developed markets," InBev said.
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