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Can Anheuser-Busch InBev Deliver Positive Revenue Trend in 2Q15?

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2Q15 results scheduled for July 30

Anheuser-Busch InBev SA (BUD) (ABI.BR) is scheduled to report its second quarter results on July 30, 2015. The consensus Wall Street analysts’ estimate for the company’s second quarter revenue is $11.5 billion. For fiscal 2015, the company expects revenue per hectoliter to grow organically at par with inflation, assuming constant geographic mix.

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Performance in the previous quarter

In 1Q15, which ended March 31, 2015, Anheuser-Busch InBev’s revenue came in at $10.5 billion, a 1.4% fall compared to 1Q14. A strong US dollar and a weakness in US business impacted 1Q15 revenue.

The first quarter reflected currency headwinds of $1.0 billion, mainly associated with currency translation effects in the Latin America-North and Europe segments. However, the company’s revenue was ahead of the consensus Wall Street analysts’ revenue estimate of $10.4 billion.

The company’s organic revenue, which excludes the impact of acquisitions and currency headwinds, grew 6.2%, as the decline in US sales was offset by a rise in sales of premium beer in emerging markets like China and Brazil.

Anheuser-Busch InBev’s adjusted EPS (earnings per share) of $1.63 in 1Q15 beat analysts’ expectations of $1.04. The bottom line in the quarter benefited from a $757 million hedging gain associated with the company’s share-based compensation.

Performance of its peers

Anheuser-Busch InBev’s key rival is MillerCoors, which is a joint venture between SABMiller and Molson Coors Brewing (TAP). In 1Q15, MillerCoors’s revenue fell 0.9% to $1.8 billion. Constellation Brands (STZ) reported 6.9% growth in revenue in the first quarter of fiscal 2016 ended May 31, 2015, driven by demand for its Mexican beer portfolio.

Constellation Brands makes up more than 1.7% of the Consumer Staples Select Sector SPDR ETF (XLP) and 0.1% of the portfolio holdings of the iShares Core S&P 500 ETF (IVV).

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