In the midst of the ongoing boycott against Bud Light, there are signs that the impact of the boycott may be easing for Anheuser-Busch InBev (AB InBev). Revenues in the U.S. dropped by 9.1% in the first quarter, primarily due to slipping Bud Light volumes. However, analysts believe that future figures will include the boycott's impact, potentially making comparative numbers easier. Despite the initial decline, AB InBev expects full-year earnings before interest, tax, depreciation, and amortization to grow in line with its medium-term outlook of between 4% to 8% [f92c3940].
AB InBev, the world's largest brewer, reported a 15.2% increase in net profits to $1.51 billion in the first quarter of 2024, despite a drop in beer sales driven by a Bud Light boycott in the United States. The company recorded a 0.6% drop in volumes sold worldwide, with beer sales posting a larger drop of 1.3%. However, higher prices allowed AB InBev to increase its revenue by 2.6% to $14.5 billion. Sales rose in 75% of its markets worldwide, thanks to a 3.3% increase in revenue per hectolitre [9d756a87].
The rise in share prices suggests that analysts and investors are optimistic about AB InBev's ability to navigate the boycott and recover from the decline in sales. This positive market response comes as analysts expect the impact of the boycott to ease in the coming months [f92c3940].
AB InBev's medium-term outlook of between 4% to 8% growth in earnings before interest, tax, depreciation, and amortization aligns with the company's commitment to long-term growth and recovery. Despite the challenges posed by the boycott, AB InBev remains focused on its strategic goals and is confident in its ability to weather the storm. The positive market response and the expectation of easing impact from the boycott indicate that AB InBev's efforts to address the controversy and maintain investor confidence are paying off [f92c3940].
Meanwhile, Budweiser's China unit has achieved its carbon emissions reduction goal two years ahead of schedule. The company has slashed its carbon emissions by over a quarter and aims to achieve net zero status across its supply chain by 2040. Budweiser will use its global expertise to train suppliers and increase the number of carbon-neutral breweries. The company has already achieved a 60.8% reduction in absolute greenhouse gas emissions at its own operations, with a 26% reduction in China alone. Collaboration with supplier partners and availability of renewable energy have contributed to the achievement. Budweiser engaged a start-up, Carbonebook, to build a digital system to collect carbon emissions data from suppliers and expand its coverage to other markets. Sustainability is a key part of the company's business strategy, and projects must consider financial and sustainability benefits. Budweiser includes sustainability in employee performance evaluations and bonuses [aefcf728].