Anheuser-Busch (BUD) 4Q Profits Rise, But Miss Expectations
The world's largest brewer, Anheuser-Busch InBev SA (NYSE: BUD), said today that its fourth quarter profits jumped to $1.28 billion, driven by cost cutting initiatives and price hikes. The company’s beer sales were stagnant during the quarter and are unlikely to improve in 2010.
The Leuven, Belgium-based company said its earnings before interest, taxes, depreciation and amortization (EBITDA), excluding onetime charges, rose to $3.11 billion, up from $2.81 billion a year earlier. The figure was substantially short of consensus expectation of $3.35 billion. BUD’s revenues in the fourth quarter fell sequentially to $9.29 billion, from $9.76 billion in the third quarter. However, revenues grew roughly 4% on a year-over-year basis.
The maker of Budweiser and Stella Artois sold 0.7% less beer and soft drinks in 2009 due to the economic downturn and rising unemployment. BUD’s beer sales fell in every region except northern Latin America, where Brazilian beer sales were driven by the launch of new products. The company said that the demand for beer across the globe is neither growing nor shrinking.
BUD has forecasted a decline in EBITDA growth to a “low- single-digit” percentage in the first quarter of 2010 as comparisons will be tough in the US and Russia has hiked its tax. The company believes that earnings growth will recover over the rest of the year.
BUD closed at $51.40 yesterday.
