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Anheuser-Busch InBev’s 2Q15 Revenue Falls Short of Expectations

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Aug. 5 2015, Published 12:46 p.m. ET

Second quarter revenue drops

Anheuser-Busch InBev (BUD) (ABI.BR) reported $11.1 billion in revenue in the second quarter of fiscal 2015 ending June 30, 2015. This reflected a 9.4% decline in the 2Q15 revenue from the comparable quarter of the previous year. The beer giant’s 2Q15 revenue missed consensus Wall Street analyst estimates of $11.5 billion.

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Factors impacting 2Q15 revenue

Anheuser-Busch InBev’s revenue in 2Q15 was adversely impacted by unfavorable weather conditions—primarily in the US and China—and a weak economic environment in some of the company’s key markets. The decline in 2Q15 revenue was also influenced by an unfavorable comparison with the second quarter of the previous year that benefited from the FIFA World Cup in Brazil.

The company’s volumes declined in four of its six key regions on an organic basis. We will discuss the company’s region-wise performance in Part 3 of this series.

Organic revenue 

Anheuser-Busch InBev’s organic revenue, which excludes the impact of acquisitions and currency headwinds, grew 4.1% in 2Q15, as higher revenue per hectoliter helped to offset the impact of lower volumes.

Volumes of the company’s focus brands, defined as those with high growth and profit potential, were down 2.0% in 2Q15. The company’s three global brands—Budweiser, Corona, and Stella Artois—grew by 6.4% in the quarter.

Results of peers

Rival MillerCoors is scheduled to announce its 2Q15 results on August 6. Revenues of MillerCoors, a joint venture between SABMiller and Molson Coors Brewing (TAP), declined by 0.9% to $1.8 billion in 1Q15. On July 1, Constellation Brands (STZ) reported its results for the first quarter of fiscal 2016 ending May 31, 2015. The company’s revenues grew 6.9%, driven by demand for its Mexican beer portfolio.

Constellation Brands constitutes ~1.7% of the portfolio holdings of the Consumer Staples Select Sector SPDR ETF (XLP) and 0.2% of the iShares Russell 1000 Growth ETF (IWF).

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