AB InBev has recorded an improvement in its third quarter results, led by the continued strength of the premiumisation trend with innovations such as its Bud Light seltzer performing well.
The owner of Budweiser and Stella Artois recorded organic revenue growth of 4% to $12.8 billion in the third quarter, which it says reflects the “resilience” of the global beer category.
The company’s latest results represent a significant improvement after its revenue dropped 17.7% in the last quarter and it took a $2.5 billion write-down in the value of its African operations due to the impact of the Covid-19 pandemic.
AB InBev’s improved third quarter results were driven by healthy volume of 1.9%. In the three months to September, the company’s own beer volumes were up by 2.6%, while its non-beer volumes fell by 2.5%.
Combined revenues of global brands increased 6.8% globally, and 8.1% outside of its respective home markets. However, an increase in at-home drinking pushed up costs as supply chains were adjusted.
The Belgium-based company particularly saw good performance in its two biggest markets, US and Brazil. In Brazil, sales rose by 25.4% driven by increased consumer demand for premium and new beers, such as a strong performance from Brahma Duplo Malte.
Meanwhile, volume and profit grew in the US, with Michelob Ultra lager and the company’s new Bud Light seltzer offsetting a decline in mainstream brands.
AB InBev also recorded growth in Mexico, Europe and China, with its ecommerce channel witnessing better online beer sales.
However, with at-home restrictions only easing in August, Colombia recorded both volume and revenue decline of high single digits. South Africa saw both its volume and revenue decline by nearly 25% in the quarter, as alcohol sales were banned for a month. Volume growth did resume in September after the ban was lifted.
“We delivered a strong and balanced top-line performance by quickly adapting to meet the evolving needs of our customers and our consumers,” said Carlos Brito, CEO of AB InBev.
Due to continued uncertainty amid the pandemic, AB InBev has scrapped its interim dividend, despite delivering stronger than expected results.