Anheuser-Busch Q2 Sales Up 4.6%
For the first six months of 2008, net sales increased 5.3 percent and diluted earnings per share (excluding the one-time item) improved 7.1 percent.
24/07/08 Anheuser-Busch Cos. Inc. which recently agreed to be acquired by a rival Belgian brewery, InBev, has reported that second quarter 2008 net sales increased 4.6 percent and diluted earnings per share (excluding a one-time item in 2007) increased 9.2 percent. For the first six months of 2008, net sales increased 5.3 percent and diluted earnings per share (excluding the one-time item) improved 7.1 percent.
“Anheuser-Busch achieved solid sales and earnings per share growth for the quarter and first half of the year.” said August A. Busch IV, president and chief executive officer of the company. “U.S. beer shipments and wholesaler sales-to-retailers increased in the quarter over last year, led by the successful launch of Bud Light Lime and improved performance of other core brands. According to IRI supermarket data, Anheuser-Busch has gained 1.0 share points at the consumer level during the last four weeks. We are encouraged by the success of our marketing and selling initiatives, and are optimistic concerning the outlook for the remaining summer selling season.”
The U.S. beer pricing environment remained favorable through the important Memorial Day and Fourth of July holidays, as expected. The company plans to implement price increases on the majority of its U.S. beer volume in September and October. These pricing initiatives will cover approximately 85 percent of the company’s domestic volume and will be tailored to selected markets, brands and packages. Overall, the company expects to achieve revenue per barrel 2/ growth of 4 percent for 2008, including favorable brand mix.
“The company’s new Strategic Plan expands and accelerates our cost reduction and operating efficiency initiatives generated by our Blue Ocean project, as well as our planned price increases. These initiatives, combined with our increased marketing and selling efforts, are all contributing to our very strong outlook for profit growth,” said Mr. Busch IV.
U.S. beer shipments-to-wholesalers increased 0.5 percent for the second quarter. Sales-to-retailers for the quarter increased 0.4 percent despite the timing of the Fourth of July holiday that adversely impacted the comparison with second quarter 2007 results. Sales-to-retailers for the second quarter plus first week of July, which eliminates the holiday timing distortion, were up 1.9 percent over the comparable period last year.
For the first six months of 2008, shipments-to-wholesalers increased 0.4 percent, and sales-to-retailers decreased 0.1 percent with import brands contributing 0.2 basis points of growth to shipments and 0.4 basis points to sales-to-retailers. The Fourth of July timing also adversely impacted year-to-date sales-to-retailers although to a lesser degree than in the quarter. Wholesaler inventories for Anheuser-Busch produced brands at the end of the second quarter were essentially level compared with inventories at the end of the second quarter 2007.
The company’s estimated U.S. beer market share for the first six months of 2008 was 48.8 percent compared to prior year market share of 48.9 percent. Market share is based on estimated U.S. beer industry shipment volume using information provided by the Beer Institute and the U.S. Department of Commerce.
International volume, consisting of Anheuser-Busch brands produced overseas by company-owned breweries and under license and contract brewing agreements, plus exports from the company’s U.S. breweries, increased 4.8 percent for the second quarter and 4.0 percent for the first six months of 2008. These increases are primarily due to increased volume in China, Canada and Argentina, partially offset by lower volume in the United Kingdom and Ireland.
Worldwide Anheuser-Busch brands volume, comprised of domestic volume and international volume, increased 1.2 percent for the second quarter and 1.1 percent for the first six months of 2008 to 33.8 million and 65.0 million barrels, respectively.
Total brands volume, which combines worldwide Anheuser-Busch brand volume with equity partner volume (representing the company’s share of its equity partners’ volume on a one-month lag basis) was 43.1 million barrels in the second quarter 2008, up 0.6 million barrels, or 1.4 percent. Total brands volume was up 1.9 percent, to 81.6 million barrels for the first six months of 2008.
Equity partner brands volume grew 2.1 percent and 5.2 percent, respectively, for the second quarter and first six months of 2008 due to Modelo and Tsingtao volume growth.
