Anheuser-Busch InBev NV plans to buy back $1 billion of shares after the world’s biggest brewer reported fourth-quarter earnings that missed estimates as it spent more on marketing to counter weak US consumption.
AB InBev will repurchase the shares this year, the Leuven, Belgium-based maker of Budweiser, Brahma and Corona said today in a statement. It also proposed a final dividend of €2 ($2.27) per share, which would boost the total payout for the year by 46 per cent.
“Priority No. 1 in the U.S. for 2015 has to be to stabilize Budweiser,” Philip Gorham, an analyst at Morningstar Inc., said by e-mail.
AB InBev said US beer industry volume will continue to improve this year after halting a decline in the fourth quarter. There, beer is increasingly losing market share to spirits as a 15-year decline has worsened recently, according to Sanford C. Bernstein. In response, the company is introducing flavored beers and ciders to win over consumers who eschew traditional brews.
The company said last year to expect a buyback as it reduced its debt after the 2012 purchase of Mexican brewer Grupo Modelo.
Speculation has mounted over the past year that AB InBev may be interested in buying SABMiller Plc, the maker of Peroni and Pilsner Urquell. The London-based company, which is the world’s second-biggest brewer, was rebuffed in an attempt to acquire Dutch beermaker Heineken NV last year, and the move rekindled talk that some kind of deal may be near.
Bloomberg News, edited by ESM
