Delta’s parent AB InBev’s year to date revenue declines despite Q3 recovery

Author Name
Respect Gwenzi
Stock Market 6 months ago

Harare – The world’s largest brewer, AB InBev’s revenue for the nine months period ended 30 September declined by 6.8% despite having recorded recoveries in the third quarter ending the same period.

AB InBev is the major shareholder to Zimbabwe’s largest brewer, Delta Corporation Limited with a 41% stake.

Revenue for Q3 2020 grew by 4% attributed to a healthy volume performance.

In a performance report for the third quarter and nine months 2020, the Group said, “Total volumes grew by 1.9% in 3Q20, with own beer volumes up by 2.6% and non-beer volumes down by 2.5%.

“In 9M20, total volumes declined by 8.2%, with own beer volumes down by 8.3% and non-beer volumes down by 5.9%”.

The Group has in the previous quarterly reports flagged subdued revenue and volumes performance stemming from the negative impact of the ongoing global coronavirus (COVID-19) pandemic which has greatly disrupted business operations and supply chains.

Combined revenues for the Group’s global brands, Budweiser, Stella Artois and Corona, increased by 6.8% globally and by 8.1% outside of their respective home markets in 3Q20.

However, in 9M20, the combined revenues for the global brands declined by 7.2% globally and by 7.5% outside of their respective home markets.

Meanwhile, cost of sales (CoS) increased by 9.6% in 3Q20 and by 8.3% on a per hl basis, driven primarily by supply chain adjustments implemented to meet evolving demand. In 9M20, CoS increased by 1.4% and increased by 10.8% on a per hl basis.

In 9M20, EBITDA declined by 16.7% to 12 254 million USD and EBITDA margin contracted by 432 bps to 35.9%.

Normalized profit attributable to equity holders of AB InBev was 1 578 million USD in 3Q20 compared to USD2,412 million in 3Q19 and was USD1,654 million in 9M20 versus USD7,125 million in 9M19.

The Group decided to shelve dividend payment due to the uncertainty and volatility arising from the COVID-19 pandemic.

“This decision is consistent with our financial discipline and prioritizes our deleveraging commitments, which have been impacted by the COVID-19 pandemic,” the Group said.

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