CEO says Mulvaney post was Bud Light post, not big campaign
Anheuser-Busch InBev, the world’s largest beer company, reported better-than-expected first-quarter earnings on Thursday.
The Belgium-based company produces about a quarter of the beer consumed worldwide and said its results underscore the resilience of the beer market in the face of economic challenges, particularly inflation. says.
The makers of Budweiser, Stella Artois and Corona have reiterated their 2023 forecast of earnings above EBITDA, with core earnings (EBITDA) growing in line with their medium-term outlook of 4% to 8%.
Some analysts said a strong first quarter may have led to a guidance hike, but on April 1 over a social media promotion with transgender influencer Dylan Mulvaney. The US’s conservative backlash against Bud Light may warrant caution.
Chief Executive Officer Michelle Duquelis said it was too early to fully assess the impact, but Bud Light’s decline in sales during the first three weeks of April was expected to increase global sales volume over that period. It equates to about 1%, he added.
He stressed that the backlash was against one brand and one social media post, not Brewer’s overall campaign. He said AB InBev will increase its investment in Bud Light over the summer.
Bernstein Autonomous Beverage Analyst Trevor Sterling said the impact on sales was significant and appears to be spreading to other AB InBev brands, but the market is likely to see April trend a year later. He said he had already factored in the worst-case scenario of continuing in the middle. .
AB InBev shares are down about 4.5% since early April, while US rival Molson Coors TAP.N is up about 25%.
AB InBev’s beer sales in the first quarter were up 0.4% year-on-year overall as China steadily lifted its COVID-19 restrictions, leading to a sharp rise in the Asia-Pacific region. Volumes fell in all other regions.
But as the company pushed for price increases and some consumers switched to more expensive beers and formats, revenue soared.
The first quarter results of AB InBev’s rivals Heineken and Carlsberg also show consumers’ willingness to absorb higher prices.
AB InBev’s core earnings increased 13.6% to $4.76 billion on a like-for-like basis, compared to an average growth rate of 5.6% expected in polls compiled by the company.
Reported by Philip Blenkinsop Edited by Kim Coghill and Elaine Hardcastle