Corona-maker beats profit forecasts on higher prices

AB InBev boosted pricing by 12% in the quarter and its premium beers outperformed.

Budweiser, Corona, and Stella Artois-maker, Anheuser-Busch InBev, reported profit growth that beat analysts’ estimates on the strongest pricing in at least a decade.

First-quarter adjusted earnings climbed 14% to $4.8bn (€4.3bn), said the world’s largest brewer, whose Bud Light brand got caught up in a marketing controversy last month. Volumes returned to growth after a dip in the fourth quarter of 2022.

Brewers ranging from Heineken to Carlsberg have been raising prices to offset higher costs for aluminum, energy and grains. AB InBev boosted pricing by 12% in the quarter and its premium beers outperformed.

In April, Bud Light suffered a backlash in the US over an advertising campaign with transgender social-media influencer Dylan Mulvaney, which may weigh on second-quarter sales.

AB InBev didn’t comment on the matter in its statement. Bud Light makes up a third of the brewer’s volumes in the US, according to Jefferies.

The brand’s volumes dropped 11% in the first week of April and 21% in the second, analyst Edward Mundy said before the results.

While revenue in the US grew by 4% on higher prices for more premium beers, sales to retailers fell by 3%, which is below industry levels. Ebitda in that market was flat.

AB InBev’s first-quarter organic sales growth of 13% was largely ahead of analysts' estimates, partly due to hyperinflation in Argentina. Excluding revenue from that country, revenue was up 9.1%.

- Bloomberg