Profits rise at AB InBev, SABMiller merger pays off

28 Jul 2017 --- The world's largest brewer, Anheuser-Busch InBev, has reported its net profit rose to US$1.5 billion in the second quarter of 2017 from US$152 million in the same period a year earlier, before its merger with rival SABMiller. Belgium-based AB InBev, which brews beers including Budweiser, Corona and Stella Artois, said that overall sales rose 5 percent to US$14.2 billion in the second quarter.

AB InBev reports that last year's US$104 billion merger with SABMiller “continues to go as planned.” The deal gives AB InBev a large presence in Africa, while increasing its business in South America and Europe.

The strategy of expanding Budweiser, Stella Artois and Corona overseas and positioning them as premium brews is paying off. The three brands grew combined revenue by 8.9 percent in the quarter. In China, AB InBev's revenue jumped 7.2 percent as Budweiser continues to surge.

Revenue in the US slipped in the quarter, with sales of Budweiser and Bud Light edging lower.

AB InBev reported an increase in underlying Q1 profits earlier this year and a return to growth in Brazil, but failed to stem the decline of Bud Light in the US. You can read the full story here.

Just last week, the company announced the acquisition of Hiball, a San Francisco-based producer of energy drinks and owner of the Alta Palla brand of organic sparkling juices and sparkling waters.

The transaction, the terms of which were not disclosed, is expected to close in the third quarter.

The acquisition marks another step into the non-alcoholic drinks sector for AB InBev, which already produces Teavana tea in partnership with Starbucks.