Regulated and inside information1 | Brussels / 06 May 2021 / 7.00am CET |
Anheuser-Busch InBev Reports First Quarter 2021 Results
"Our business is off to a very strong start in 2021. We delivered top-line ahead of pre-pandemic levels, as beer volumes were up by 2.8% versus 1Q19 with healthy revenue per hl growth. EBITDA increased by 14.2% year-over-year, even in the context of ongoing COVID-19 related restrictions.
Today, we announced that I will be stepping down from AB InBev after 32 incredible years, effective July 1st, when Michel Doukeris will succeed me as AB InBev's next CEO. My proudest moments during these years have been to watch our people grow and our company develop. Together, we built the leading and most profitable global brewer, with the best brands, and more importantly, the best people. It has been a privilege and an honor to be part of this team of 164 000 inspirational colleagues around the world. I am very excited about the future of our business under Michel's leadership and congratulate him on the appointment as CEO of this amazing company." - Carlos Brito, CEO
Total Volume
+13.3%
Total volumes grew by 13.3%, with own beer up by 14.9% and non-beer up by 4.0%.
Total Revenue
+ 17.2%
Revenue grew by 17.2% with revenue per hl growth of 3.7%, driven by ongoing premiumization and revenue management initiatives.
Underlying Profit
1 099 million USD
Underlying profit (normalized profit attributable to equity holders of AB InBev excluding mark-to-market gains and losses linked to the hedging of our share-based payment programs and the impact of hyperinflation) was 1 099 million USD in 1Q21 compared to 1 015 million USD in 1Q20. Normalized profit attributable to equity holders of AB InBev was 1 013 million USD in 1Q21 versus -845 million USD in 1Q20.
Global Brands Revenue
- 46.4% (outside their home markets)
Combined revenues of our global brands, Budweiser, Stella Artois and Corona, increased by 29.5% and by 46.4% outside their home markets.
Normalized EBITDA
+ 14.2%
Normalized EBITDA increased by 14.2%, with Normalized EBITDA margin contraction of 91 bps to 34.7%.
Underlying EPS
0.55 USD
Underlying EPS (normalized EPS excluding mark-to-market gains and losses linked to the hedging of our share-based payment programs and the impact of hyperinflation) was 0.55 USD in 1Q21, an increase from 0.51 USD in 1Q20. Normalized EPS in 1Q21 was 0.51 USD, an increase from -0.42 USD in 1Q20.
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1The enclosed information constitutes inside information as defined in Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse, and regulated information as defined in the Belgian Royal Decree of 14 November 2007 regarding the duties of issuers of financial instruments which have been admitted for trading on a regulated market.
MANAGEMENT COMMENTS
Very strong start to 2021 with balanced top-line growth translating to double-digit EBITDA growth
Our business is off to a very strong start in 2021. Our winning commercial strategy, best-in-class brand portfolio, digital platforms and operational excellence led to market share gains in the majority of our key markets. We delivered balanced top-line growth of 17.2%, comprised of 13.3% total volume growth and 3.7% revenue per hl growth, driven by revenue management initiatives and premiumization. Compared to pre-pandemic levels of 1Q19, we delivered own beer volume growth of 2.8%, even in the context of ongoing COVID-19 related impacts, such as on-premise channel restrictions across our markets (particularly in Europe) and a one-month ban on the sale of alcohol in South Africa.
Healthy revenue growth translated to an EBITDA increase of 14.2%. Positive brand mix and ongoing cost discipline was somewhat offset by anticipated pressures from transactional FX and commodity headwinds, channel and packaging mix, and an increase in our SG&A as a result of higher variable compensation accruals, which are recorded by quarter at the zone level depending on operational performance.
Clear commercial strategy rooted in customer- and consumer-centricity:
- Reaching more consumers on more occasions through a portfolio approach:
- Premium portfolio delivering meaningful growth to top- and bottom-line:Our premium portfolio grew by 28% in 1Q21, representing over 30% of our revenue and carrying a higher profit per hectoliter than our core brands. Our global brands - Budweiser, Stella Artois and Corona - led that growth, delivering 46% revenue growth outside of their respective home markets, where they typically command a price premium. Compared to 1Q19, they grew by 24% outside of their home markets.
- Gaining share of the core and value segments: We delivered healthy share of core and value segment gains across our markets, enhanced by superior innovation and smart affordability initiatives.
- Expanding the category: Our Beyond Beer business, which includes brands such as Mike's Hard, Flying
Fish and Bud Light Seltzer, generated over 1 billion USD in 2020 and grew by more than 40% in 1Q21.
- Expanding the category: Our Beyond Beer business, which includes brands such as Mike's Hard, Flying
- Scaling our digital platforms to create value for customers and consumers:
- Digitizing our relationships with our more than 6 million global customers: In 1Q21, our proprietary B2B platform, BEES, captured over 3 billion USD in gross merchandise value (GMV), growing more than 50% from 4Q20. In March 2021, our monthly active user base (MAU) exceeded 1.5 million users, more than 60% above December 2020. BEES generated incremental revenue through a combination of accelerated growth of our base business and expanding into new offerings through the platform. More information can be found atwww.bees.com.
- Leading the way in e-commercebeer sales: Our owned e-commerce business quadrupled in size this quarter. Our courier platforms are now available in nine markets and 220 cities, covering nearly 120 million consumers. In Brazil, Zé Delivery continues to grow exponentially, delivering over 14 million orders in 1Q21, more than half of the amount delivered in all of 2020.
Excited about the future of our business
Our industry-leading portfolio of brands is connecting us with more consumers on more occasions, as shown by continued top-line growth. We are solving real customer and consumer needs with digital platforms, connecting us more closely to those we serve worldwide. As the world overcomes COVID-19, our purpose of Bringing People Together for a Better World is more relevant than ever.
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2021 OUTLOOK
- Overall Performance: We expect our FY21 normalized EBITDA to grow between 8-12% and our revenue to grow ahead of EBITDA from a healthy combination of volume and price. The outlook for FY21 reflects our current assessment of the scale and magnitude of the COVID-19 pandemic, which is subject to change as we continue to monitor ongoing developments.
- Net Finance Costs: We expect the average gross debt coupon in FY21 to be approximately 4.0%. Net pension interest expenses and accretion expenses including IFRS 16 adjustments (lease reporting) are expected to be in the range of 140 to 160 million USD per quarter, depending on currency fluctuations. Net finance costs will continue to be impacted by any gains and losses related to the hedging of our share-based payment programs.
- Effective Tax Rates (ETR): We expect the normalized ETR in FY21 to be in the range of 28% to 30%, excluding any gains and losses relating to the hedging of our share-based payment programs. The increase versus 2020 is due to factors including the phasing out of temporary COVID-19 measures and changes to tax attributes in some key markets.
- Net Capital Expenditure: We expect net capital expenditure of between 4.5 and 5.0 billion USD in FY21 as we are increasing investments in innovation and other consumer-centric initiatives to fuel our momentum.
- Debt: Approximately 49% of our gross debt is denominated in currencies other than the US dollar, primarily the Euro. Our optimal capital structure remains a net debt to EBITDA ratio of around 2x.
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Figure 1. Consolidated performance (million USD)
1Q20 | 1Q21 | Organic | |
growth | |||
Total Volumes (thousand hls) | 119 683 | 135 553 | 13.3% |
AB InBev own beer | 103 435 | 119 010 | 14.9% |
Non-beer volumes | 15 383 | 15 944 | 4.0% |
Third party products | 864 | 598 | -22.5% |
Revenue | 11 003 | 12 293 | 17.2% |
Gross profit | 6 431 | 7 050 | 14.8% |
Gross margin | 58.4% | 57.3% | -122 bps |
Normalized EBITDA | 3 949 | 4 267 | 14.2% |
Normalized EBITDA margin | 35.9% | 34.7% | -91 bps |
Normalized EBIT | 2 805 | 3 113 | 18.4% |
Normalized EBIT margin | 25.5% | 25.3% | 26 bps |
Profit from continuing operations attributable to equity holders of AB InBev | -2 375 | 595 | |
Profit attributable to equity holders of AB InBev | -2 250 | 595 | |
Normalized profit attributable to equity holders of AB InBev | -845 | 1 013 | |
Underlying profit attributable to equity holders of AB InBev | 1 015 | 1 099 | |
Earnings per share (USD) | -1.13 | 0.30 | |
Normalized earnings per share (USD) | -0.42 | 0.51 | |
Underlying earnings per share (USD) | 0.51 | 0.55 | |
Figure 2. Volumes (thousand hls)
1Q20 | Scope | Organic | 1Q21 | Organic growth | ||
growth | Total Volume | Own beer volume | ||||
North America | 24 383 | 52 | 702 | 25 137 | 2.9% | 1.8% |
Middle Americas | 29 937 | - | 3 127 | 33 064 | 10.4% | 12.2% |
South America | 34 260 | 58 | 4 145 | 38 463 | 12.1% | 15.1% |
EMEA | 18 087 | -51 | -371 | 17 665 | -2.1% | -0.1% |
Asia Pacific | 12 781 | - | 8 096 | 20 876 | 63.3% | 64.1% |
Global Export and Holding Companies | 236 | -32 | 143 | 347 | 70.1% | 67.9% |
AB InBev Worldwide | 119 683 | 27 | 15 843 | 135 553 | 13.3% | 14.9% |
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KEY MARKET PERFORMANCES
United States: Consistent execution of our commercial strategy driving top and bottom-line growth
- Operating performance: Our sales-to-wholesalers (STWs) grew by 2.9% and revenue per hl grew by 2.4%, resulting in total revenue growth of 5.4%. Our STRs were down by 0.8%, estimated to be below the industry, largely due to a challenging comparable from 'pantry-loading'behavior in March 2020. This impact has been temporary, as healthy volume growth in April has brought our STRs back to growth year-to-date April 2021. EBITDA grew by 1.3% in the quarter.
- Commercial highlights: We continue to strengthen and premiumize our portfolio, rebalancing toward faster growing above core segments. Our 1Q21 results were fueled by our innovations, as we led the industry in total innovation. Our above core beer offerings continue to outperform, highlighted by the strong growth of Michelob ULTRA and our craft brands. Our seltzer portfolio continues to grow ahead of the industry according to IRI, and we delivered triple-digit growth of our canned cocktail brand, Cutwater.
Mexico: Strong and balanced top-line growth ahead of the industry
- Operating performance: In Mexico, we delivered top-line growth of high single digits, consisting of a healthy balance of both volume and revenue per hl. Each grew by mid-single digits, with volumes growing ahead of the industry. EBITDA was flattish year-over-year, impacted by increased cost of sales, primarily related to transactional FX headwinds and packaging mix.
- Commercial highlights: We achieved strong growth across our portfolio in both the core and above core segments. Michelob ULTRA Hard Seltzer is gaining traction, with clear leadership of the developing seltzer segment. We also successfully completed the fifth wave of our expansion into the country's largest convenience store, OXXO, making our brands now available in nearly 9 000 stores. Our direct-to-consumer retail chain, Modelorama, grew by high single digits year-over-year in same-store sales, and our last mile delivery platform, Modelorama Now, is on track for its national roll-out. Orders through our BEES platform now make up over 50% of our revenue.
Colombia: Ongoing healthy recovery with top and bottom line growth above 20%
- Operating performance: We continue to deliver a very healthy recovery of our business in Colombia. Compared to 1Q19, our volumes in 1Q21 grew by double-digits each month of the quarter. Year-over-year, volumes grew in the low twenties, leading to revenue growth in the mid-twenties. EBITDA grew in the low-twenties with healthy top-line growth somewhat offset by transactional FX headwinds.
- Commercial highlights: We delivered strong performances across our portfolio. Our core brands, Aguila and Poker, grew by double-digits, and our global brands grew even faster, led by Corona and Budweiser. We are advancing the digital transformation of our business, with orders through our BEES platform now representing over 70% of our revenue.
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AB - Anheuser-Busch InBev NV published this content on 14 June 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 June 2021 15:43:03 UTC.