BUD Anheuser Busch Inbev SA NV

By Ian Walker

Anheuser-Busch InBev has reported a massive fall in second-quarter net profit--missing market expectations--as a fall in U.S. volumes offset rises in other regions.

The world's largest brewer--which houses Stella Artois and Budweiser among its portfolio--said Thursday that overall volumes fell 1.4%, matching expectations. Within this, North America volumes fell 14.5%.

Sales in the region have been falling since April when Dylan Mulvaney, a transgender social-media star, made an Instagram post about a personalized can of Bud Light that the brewer had sent her as a gift. The post sparked a boycott that caused sales of Bud Light, and other brands, to fall.

Net profit for the quarter fell to $339 million compared with $1.60 billion for the comparable period a year earlier and a FactSet consensus of $613.35 million.

Revenue for the quarter rose to $15.12 billion from $14.79 billion, driven by pricing actions, premiumization--the strategy of emphasizing luxury versions of its products--and other revenue-management moves. Revenue consensus was $15.38 billion.

On an organic basis, revenue grew 7.2%, beating a company-provided market consensus of 6.4%.

In the U.S., sales to retailers fell 14.0%, underperforming the industry, mainly due to lower Bud Light volumes.

Late last month the company laid off hundreds of workers at its U.S. offices after months of slumping sales at Bud Light. It said the cuts would affect less than 2% of its roughly 18,000 U.S. workforce. The layoffs won't impact front-line workers such as brewery and warehouse staff, the company added.

Normalized earnings before interest, tax, depreciation and amortization--one of the company's preferred metrics which strips out exceptional and other one-off items--fell to $4.91 billion from $5.10 billion and compares with a consensus of $4.845 billion.

Looking ahead, AB InBev reiterated that it expects 2023 Ebitda to grow in line with its medium-term outlook of between 4% and 8% and revenue to grow ahead of Ebitda from a healthy combination of volume and price.

Earlier this week Heineken cut its full-year outlook after reporting a fall in key earnings for the first half, largely due to lower volumes in the profitable Asia-Pacific region.

Write to Ian Walker at ian.walker@wsj.com

(END) Dow Jones Newswires

August 03, 2023 01:56 ET (05:56 GMT)

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