Anheuser-Busch InBev’s (A-B) U.S. businesses recorded double-digit shipments and depletions declines in Q1, the final quarter before the company begins to lap initial accelerated declines from the conservative-led boycott of Bud Light that began in April 2023.
Shipments (sales to wholesalers) declined -10.1%, as “Q1 shipments caught up with the stronger depletions in December 2023,” according to A-B’s financial release, shared this morning. Depletions (sales to retailers) declined -13.7%, “primarily due to the volume decline of Bud Light.”
As a refresher, Bud Light lost 2.72 points of share of total beer category dollar sales year-over-year (YoY) in NIQ-tracked off-premise channels in the 13-week period ending March 23, 2024. Dollar sales declined -28% and volume -29.1% in the period.
A-B’s Q1 2023 comps were not the double-digit declines that the company will go up against the rest of FY2024. However, the quarter’s results were not positive in 2023, with U.S. shipments (-1.6%) and depletions (-3%) both declining single-digits.
A-B’s Q1 2024 U.S. earnings before interest, taxes, depreciation and amortization (EBITDA) declined -17.9%, as “top-line performance and support measures” for A-B’s wholesaler partners “were partially offset by productivity initiatives,” the company reported.
Looking at the positives of the quarter, A-B noted that “while mainstream beer volumes declined, our above core beer megabrands volume continued to grow.” Additionally, its spirits-based ready-to-drink (RTD) offerings, such as Cutwater Spirits and Nütrl Vodka Seltzer, “delivered strong double-digit volume growth, outperforming the industry.”
A-B’s total revenue increased +2.6% in the quarter, with revenue per hectoliter increasing +3.3%. The company’s normalized EBITDA increased +5.4% YoY, to $4.987 million. Global volume declined -0.6%, with A-B’s own beer volume declining -1.3%, and its “non-beer” volumes increasing +3.5%.
A-B also noted that revenue from its global non-alcoholic (NA) beer offerings grew in the high-teens, led by Corona Cero and Budweiser Zero. “Above core beer” revenue increased in the low single digits, driven by “global brands” and double-digit growth from “lother local megabrands such as Leffe in Europe and Spaten in Brazil.”
“The strength of the beer category, our diversified global footprint and the continued momentum of our megabrands delivered another quarter of broad-based top- and bottom-line growth,” A-B CEO Michel Doukeris said in the release. “We are encouraged by our results to start the year, and the consistent execution by our teams and partners reinforces our confidence in delivering on our 2024 growth ambitions.”
Those 2024 ambitions include full-year EBITDA growth between 4% and 8%, reflecting the company’s “current assessment of inflation and other macroeconomic conditions.”
Other highlights for A-B’s global business in the quarter include:
- Consumer purchasing across A-B’s portfolio increased in 40% of its total markets, led by female consumers “in key markets such as Latin America and Europe;”
- Global brands’ revenues increased +5.2% outside of their home markets, led by Corona (+15.5%);
- Beyond beer offerings contributed $320 million to the quarter, due to low-single-digit volume increases versus Q1 2023;
- Beyond beer growth was partially offset by “a soft malt-based seltzer industry in the U.S.,” but ended in the green due primarily to spirits-based RTDs and flavored malt beverages in the U.S., and the expansion of spritzer brand Brutal Fruit in Africa.
- Approximately 70% of A-B’s global revenue was through B2B digital platforms;
- $130 million of revenue was generated by A-B’s digital direct-to-consumer “ecosystem.”