AB InBev net profit climbs 34%01 August 2012
Brussels-based brewer AB InBev increased net profit by 34% to $3.65 billion in the first half of the year.
Though net sales were up 1.3% to $19.2 billion, ABInBev blamed "soft" second quarter volumes and higher transportation costs in the US and Brazil for a 0.13% fall in first half operating profit to $7.15 billion.
Volumes in the US and Western Europe dipped in the first half of the year but global volumes were up 1% as the firm notched up growth of 5.9% and 3.4% in China and Brazil respectively.
The brewer said that its volumes in the US were "soft" because of changes to shipping patterns which saw the amount of beer distributed to wholesalers fall.
"We are encouraged by current trends [in the US], with the first six months of the year seeing the best industry performance since 2008. This has been due to favourable weather and an improvement in the economy, especially in the first quarter, as well as industry innovations throughout the year,” said a company statement.
The company has introduced new products such as Bud Lite Platinum in the US but saw its marketing costs climb 9.1% during the first six months of the year. However, Q2 profits in the US were down 4% to US$3.59 billion but sales nudged up to US$19.2 billion.
AB InBev, which owns Budweiser, currently commands 50% of the US beer market.
Meanwhile, the company said that the on-trade and packaging innovations fuelled growth in Brazil in the second quarter.
“Our three national brands continue to perform well and we are committed to further enhancing consumer preference for these brands while pursuing regional market share opportunities,” added the statement.
The firm has a 70% share of the Brazilian beer market.
AB InBev said that it expects to deliver growth in the US in the second half of the year as a result of the readjustments to shipping patterns. Brazil has also been earmarked for volume growth as the company expects to achieve a healthier balance between volumes and price.
Shares in the brewer were down 3.9% to €63.67 on the news.
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