Beer giant Anhueser-Busch InBev has reported forecast-beating core profit for the second quarter as cost discipline measures paid off, despite revenue and volumes falling short of expectations.
The world's largest brewer by volume reported a 10.2% rise in second-quarter normalised core profit (EBITDA), surpassing analysts' forecast for growth of 8.3%.
Investors see the period as a return to normality for the maker of Budweiser and Stella Artois. After the COVID-19 pandemic in 2020 all brewers faced a steep and fast rise in input costs which is only now slowing down.
AB InBev was also hit by a prolonged consumer boycott of key brand Bud Light in the United States, whose impact is now fading.
'Encouraged With Our Performance'
"We are encouraged with our performance in the first half of the year and remain focused on consistent execution of our strategy," CEO Michel Doukeris said.
While revenue and volumes fell short of forecasts, analysts said AB InBev had delivered solid performance against generally weak results for peers like Heineken.
Shares of Heineken, the world's second-largest brewer, fell more than 9% on Monday (29 July) after the company said an anticipated sales boost had not materialised due to bad weather.
Heineken's upgraded annual profit guidance was also lower than expected by some analysts.
AB InBev maintained its full-year guidance. Brett Cooper, managing partner at equity research firm Consumer Edge said this may disappoint some investors given the Belgian company's strong performance across the first-half.
Trevor Stirling, an analyst at Bernstein, however said AB InBev may be on course to beat its own forecast for the full year, especially as it faces easier comparative numbers in the second half.
"The risks would appear to be on the upside," he said.
Regional Highlights
AB InBev said it too was affected by bad weather in key parts of its geographic footprint in China, driving down revenue and volumes in the country by 15.2% and 10.4%, respectively.
In Argentina, a surge in inflation has put pressure on consumers and beer sales. AB InBev said its volumes declined by more than 20% in the second quarter.
The company also saw its revenue fall 0.6% in the key US market, where the boycott of Bud Light knocked the brew from its top spot as the nation's best-selling beer last year.
