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Beer premiumisation in "infant stages" compared to wine, spirits - Anheuser-Busch InBev CEO

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Brewers should make more of the premiumisation trend in the beer category, which lags far behind wines and spirits, the CEO of Anheuser-Busch has said.

A-B InBev is forecasting growth in its premium High End portfolio, which includes brands such as Stella Artois

A-B InBev is forecasting growth in its premium High End portfolio, which includes brands such as Stella Artois

Speaking to investors in Johannesburg yesterday, Carlos Brito claimed that beer premiumisaton is at the start of its road, with brewers yet to make the most of added-value products. He said the beer industry must target trends that have seen sales for premium wines and spirits outpace lower-priced propositions.

"Compared to wine and spirits, beer is in its infant stages of premiumisation," Brito said. "This could provide the beer category with the opportunity to continue to increase sales value and also margin by enhancing mix."

Brito was speaking at A-B InBev's Capital Markets presentation, which is held every three years. Management at the event told investors that its premium High End portfolio, which includes A-B InBev's craft acquisitions as well as Stella Artois and Estrella Jalisco, expects to increase annual sales from US$3.6bn in 2016 to $7.2bn by 2020. Writing in a note after yesterday's presentations, Jefferies analyst Edward Mundy said this would be worth an extra 1.5% to group top-line growth every year.

Brito added that A-B InBev is continuing to find success in China's premium beer market. He said strong sales for Budweiser, and the recently-introduced Corona, mean the company now accounts for more than 20% of the Chinese beer market.

Last week, Heineken announced its intention to grow its namesake premium brand in China by signing a licensing agreement with the country's biggest brewer, China Resources Beer. The brewer has a less-than 1% share of China's beer market but is hoping to emulate A-B InBev's success in premium beer as middle-class consumers continue to grow in number.

Is Heineken risking too much to chase Anheuser-Busch InBev in China? - Click here for a comment


Sectors: Beer & cider

Companies: Anheuser-Busch InBev

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