Corona-Brewer AB InBev Gains on Guiding Fatter Annual Profit

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Corona-Brewer AB InBev Gains on Guiding Fatter Annual Profit
Credit: © Reuters.

By Dhirendra Tripathi – Anheuser-Busch InBev (BR: ABI ) stock traded 0.4% higher in Brussels Thursday after the world's largest brewer forecast bigger profits in 2022, in line with its medium-term growth range.

Earnings before interest, taxes, depreciation, and amortization is expected to rise 4-8% this year and annual revenue should expand by a higher percentage due to a “healthy combination of volume and price,” the maker of Hoegaarden and Leffe beers said while disclosing its fourth quarter results.

The company was silent on inflation in its outlook. This compares with rival Heineken's (AS: HEIN ) February 16 warning about a significant impact due to inflation and supply chain pressures.

Higher prices were of no deterrence as volumes grew in both beer and non-beer segments. Total revenue in the fourth quarter jumped over 12% to top $14 billion as economies reopened, allowing people access to more places to indulge.

AB InBev said the combined revenue of its global brands, namely Budweiser, Stella Artois, and Corona grew more than 23% outside of their respective home markets in the fourth quarter, riding the price premium they enjoy there.

AB InBev’s ‘Beyond Beer’ business grew by over 20%, contributing $1.6 billion to annual revenue of over $54 billion. Revenue through the year grew nearly 16%.

The company reported a 5% like-for-like increase in fourth quarter EBITDA to $4.88 billion.

Underlying profit fell 8% to $1.48 billion as cost of sales and selling, general and administrative expenses grew at a faster pace than revenue. For the full year, underlying profit was $5.8 billion, up 15%.

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