AB InBev sees “momentum” at end of 2020, forecasts higher 2021 earnings

AB InBev said that its total volumes declined by 5.7% in FY2020, following the impact of the Covid-19 pandemic across its business.

In AB InBev’s full-year results, revenue declined by 3.7% on an organic basis, but the company saw revenue growth of 4.5% in Q4 and said that it “finished the year with momentum in our key markets”.

The world’s largest brewer recorded revenues of $46.88 billion compared with last year’s $52.33 billion. Meanwhile, EBITDA fell 12.9% to $17.32 billion.

The Beck’s and Hoegaarden owner forecast “meaningfully” better 2021 earnings, predicting increased drinking and higher prices in the year ahead.

In FY2020, the combined revenues of AB InBev’s three global brands – Budweiser, Stella Artois and Corona – decreased by 5.0% globally.

In the Europe, Middle East and Africa region, AB InBev’s own beer volumes fell by nearly 11% for the full year but the company reported “strong gains” in market share in France, Germany and the Netherlands.

In FY2020, the brewer’s US business delivered “continued market share trend improvement”. The company said that it consistently executed its ‘consumer-first’ strategy focused on premiumisation, health and wellness, and innovation.

In Brazil, AB InBev sold 11.9% more beer in the fourth quarter than a year earlier, with 5.6% volume growth for the full year.

In this market, the company’s performance was positively impacted by government subsidies that increased consumers’ disposable income, as well as by the digital transformation of its business, with the company’s main direct-to-consumer initiative Zé Delivery now present in all 27 Brazilian states.

In Mexico, sales rose after a two-month government-mandated shutdown of the company’s operations, with AB InBev reporting high-single-digit revenue growth in Q4.

The company said that its ‘beyond beer’ portfolio – spanning categories such as hard seltzer and ready-to-drink cocktails – has now reached well over $1 billion in revenue and grew by double-digits in 2020.

“In an extremely challenging year, our teams rose to the occasion,” said AB InBev CEO, Carlos Brito.

“We finished the year with momentum in our key markets by leveraging our fundamental strengths as a company and capturing the benefits of investments we have been making for several years in our portfolio and rapidly growing platforms, such as BEES and Zé Delivery.

“We are now more closely connected than ever to the 6 million+ customers and 2 billion+ consumers we serve worldwide through our clear commercial strategy, revamped innovation process, digital platforms and ongoing operational excellence.”