Alexa

InBev blames poor Chinese sales for losing slot as top brewer

InBev blames poor Chinese sales for losing slot as top brewer

Belgian brewer InBev SA on Thursday blamed poor performance in China for losing its crown as the world's biggest brewer by volume to SABMiller PLC last year.
"That was a huge market, even bigger for some of our competitors than for us and there was a big gap between their performance and ours," said chief executive Carlos Brito.
InBev would try to remedy that, he said, announcing the company would take full control of a Zhejiang brewery but warning that "we're not going to solve this in one year."
Brito refused to comment on news media speculation that InBev could merge with Anheuser-Busch Cos. Inc., insisting the company is happy with its current size and stretch.
"Biggest is nice but best is even nicer and more sustainable, so that's our aim," he said.
SABMiller has surged ahead in China, where it now brews Snow, the most popular beer in the world's most populous nation.
Its takeover of Dutch brewer Royal Grolsch NV _ which closed last week _ and a U.S. joint venture with Molson Coors helped bring beer volumes to 272 million hectoliters last year, according to preliminary figures from Datamonitor market research.
This squeaks past InBev's 270 million hectoliters for 2007.
InBev reported Thursday that profit more than doubled in the fourth quarter to euro900 million (US$1.35 billion) from euro371 million (US$490 million) a year earlier on real estate gains and sales of more beer in Latin America, eastern Europe and Russia.
This came in far ahead of a euro490 million (US$737 million) forecast from analysts surveyed by Dow Jones Newswires. InBev said the figure included a euro339 million (US$510 million) one-off gain from selling off Dutch and Belgian bars as well as a lower tax rate.
Revenue in the three months ending Dec. 31 was euro3.88 billion (US$5.8 billion), up 8 percent from euro3.59 billion (US$4.74 billion) the previous year.
But the brewer of Beck's and Stella Artois warned of tougher times ahead as higher prices for transport, glass and aluminum for packaging and beer ingredients barley and sugar add costs while a slowing global economy eats into sales.
InBev has relied on strong sales in booming markets in Latin America _ where it sells Brazil's Brahma beer and Argentina's Quilmes _ and its move into eastern Europe and Asia as western Europeans increasingly shun beer for wine and other drinks.
The lager lout image of Stella Artois in Britain has hurt market share in one of its most lucrative markets _ with InBev seeing all British sales slip a tenth last year _ and caused one judge in Brighton to link the high-alcohol beer with binge drinking and violence.
Brito claimed Stella was a victim of a much larger British debate on alcohol misuse.
"It's very unfortunate for us _ Stella just being present everywhere, being the brand which is the most loved ... is being portrayed whenever people want to give an example of the industry," he said.
InBev warned of lower growth for the first and second quarters of this year compared to strong volume sales for the same periods in 2007. It said it would not hike prices more than inflation _ which it forecast at some 4 percent for the regions where it operates.
A new distribution deal with Anheuser in the U.S. is helping to place more InBev beers in American hands, but initial supply problems with switching to the new distribution network held back sales during the full year, the company said.
For all of 2007, InBev saw profit increase just over 5 percent to euro2.2 billion (US$3.31 billion) from euro1.41 billion (US$1.86 billion) in 2006. Full-year revenue went up 8 percent to euro14.4 billion (US$21.66 billion) from euro13.3 billion (US$17.57 billion) in the previous year.
The company also announced it would spend euro500 million (US$752 million) buying back shares over the next 12 months.


Updated : 2020-12-06 07:46 GMT+08:00