AB-InBev misses earnings estimates in fourth quarter
During the fourth quarter 2009 EBITDA went up 11.5 percent to USD 3.11 billion, thus missing analysts’ expectations of USD 3.3 billion.
The amount of beer sold by AB-InBev in the final quarter of 2009 declined in every region except for northern Latin America, where beer sales were up 11.6 percent, boosted by Brazil, where the brewer increased its market share 1.2 percentage points to 68.7 percent, AB-InBev said.
For the full year, beer volume fell 2.0 percent in North America. In central and eastern Europe, volumes were under even greater pressure: down 10.8 percent across the region. In Russia, the drop in sales volume was higher: - 13.1 percent. In the Ukraine, AB-InBev’s volumes declined only 4.8 percent, the brewer said.
Despite wide-spread declines in volumes, AB-InBev managed to reduce its net debt to USD 45.2 billion as of 31 December 2009 from USD 56.7 billion a year earlier, the company said. That equates to a ratio of 3.7 times EBITDA.
Full-year EBITDA margin, a gauge of profitability, widened to 35.5 percent from 30.8 percent in 2008.
In the past year, the company has sold off its theme parks, can plants and its South Korean and central European beer units. The brewer also cut USD 1.11 billion of costs, beating its forecast of USD 1 billion, by shrinking its workforce from the U.S. to Europe.
AB-InBev expects “modest” volume growth this year, “in line” with the fourth quarter, CFO Felipe Dutra said. Profit growth this year will be “heavily skewed” to the second half, he added.
AB-InBev didn’t change its target for USD 2.25 billion of so-called synergies by the end of 2011. “We are working hard to find more synergies beyond 2011,” Mr Dutra said.
According to AB-InBev’s most recent SEC filing, the brewer still carries a net debt load of USD 45.2 billion following its acquisition of Anheuser-Busch in 2008. The bulk of its debts has to be repaid within three to five years. Thanks to the recent refinancing deal, AB-InBev managed to postpone paying back USD 17 billion by a few years.
