AB InBev eyes Hong Kong listing as it misses earnings expectations
By Nick Hedley - May 9th, 10:02
Anheuser-Busch InBev (AB InBev), which took over SABMiller in 2016 and is the world’s biggest brewer, says it plans to list its Asia-Pacific business in Hong Kong.
The listing of a minority stake on the Hong Kong Stock Exchange was subject to valuations and prevailing market conditions, management said recently.
The Asia-Pacific region accounts for about 18% of AB InBev’s total volumes, although volumes in the region declined in the first quarter of 2019, the group said.
The merits of a listing “are based upon the creation of an Asia-Pacific champion in the consumer goods space”, the group said.
“Furthermore, our superior portfolio of brands and leadership position in the beer industry provide an attractive platform for potential mergers and acquisitions in the region.”
Selling a minority stake would also accelerate AB InBev’s strategy to deleverage.
AB InBev said group volumes rose by 1.3% in the first quarter and revenue grew by 5.9% thanks partly to better revenue per hectolitre.
“The topline result was driven by healthy performances in several of our key markets, including Brazil, China, the US, Europe, Colombia and Nigeria,” management said.
However, “softer volume results” were seen in SA and Argentina, “where the consumer remains under pressure due to challenging macroeconomic conditions”.
Revenue declined by mid-single digits in SA partly because of a shift toward premium beverages, where the group’s market share is less than its average despite recent gains driven by Corona and Budweiser, it said.
Group earnings before interest, taxes, depreciation, and amortisation (ebitda) increased by 8.2% in the quarter, which missed analysts’ forecasts. According to Bloomberg data, analysts expected 8.6% growth in ebitda.
AB InBev said profit, excluding mark-to-market gains linked to the hedging of its share-based payment programmes and the impact of hyperinflation, was $1.572bn, compared to $1.685bn a year before.
The integration process with SABMiller yielded “synergies and cost savings” of $100m in the quarter.
Woolworths carves out market share in SA
27/11/2019 - 10:11
In Australia, David Jones's sales declined 2.1%, with the company saying a store refurbishment contributed to the decline.
Push and pull strategies work together to keep consumers coming back for more
26/11/2019 - 10:20
The retail sector is under increasing pressure as consumers have shrinking disposable income in a strained economy. Maintaining share of wallet is critical. Relying solely on a push route to market strategy from manufacturers into retailers is not enough to get consumers buying products. A pull strategy needs to coexist with the push to drive brand consumption. Integrating these strategies requires intelligent and insightful decision-making. This, in turn, requires data generated through smart technology which provides line of sight across the value chain from manufacturer to distribution, retailer to the consumer.
Today’s customers are loyal to speed and convenience, not brands
25/11/2019 - 11:15
Consumer expectations are rapidly shifting as technologies such as mobile, geolocation, social media and increasingly, Internet of Things devices and wearables, connect people to a world of easily accessible information and convenient services. With the ability to browse, compare and order with a few swipes and taps, consumers are becoming trained to value convenience and service above nearly anything else.
Gearing FMCG manufacturing for the red season spike and maximising profits all year round
25/11/2019 - 11:03
As we enter the festive season, demand for Fast-Moving Consumer Goods (FMCG) increases rapidly, often leaving manufacturers scrambling to fulfill orders from their distribution channel. If demand cannot be met, then loss of revenue is inevitable. However, over-production is not an ideal solution either, as it can leave manufacturers sitting with unsold stock that costs money to store.
Black Friday not necessarily a “black & white” decision for small business growth
25/11/2019 - 10:52
Black Friday, once only a North American marketing frenzy, has become a critical entry in the calendars of South African retail business owners.