AB InBev Earnings Preview 2023

Anheuser-Busch InBev is set to announce its fourth-quarter and full-year 2023 results on Thursday. Here's a breakdown of what to expect.

Revenue Forecast

The global brewing giant, home to iconic brands like Stella Artois and Budweiser, is projected to reveal revenue of $15.505 billion for the quarter. This estimate, based on 19 analysts' predictions from Visible Alpha, marks a significant increase from the $14.67 billion reported in the same period last year.

Volume Forecast

Analysts anticipate a slight decline in volumes for AB InBev, with an estimated 146.3 million hectoliters of beer to be sold in the quarter. This figure is lower compared to the 148.775 million hectoliters sold in the fourth quarter of 2022 according to Visible Alpha.

EPS Forecast

Earnings per share for AB InBev are expected to decrease to $0.84 from $1.41, as forecasted by Visible Alpha consensus data.

Stock Performance

Over the past year, AB InBev's shares have shown a modest 1.1% increase, but they have dipped by 0.9% since the beginning of this year.

Key Factors to Monitor

The performance in the U.S. market will be closely monitored following a recent downturn in sales. The company faced challenges after a social-media post by a prominent figure led to a boycott impacting sales of Bud Light and other brands.

Stay tuned for Anheuser-Busch InBev's latest financial update as it navigates through the evolving market dynamics and consumer preferences.

Recent Tax Changes Impact AB InBev's Earnings

Citi analysts have projected that recent changes to Brazil's corporate tax structures could result in a significant increase in AB InBev's tax rate, potentially by around 500 basis points. According to the analysts, management is expected to guide for a 30% to 32% tax rate in the year 2024.

Economic Headwinds Pose Challenges

Moreover, Citi analysts highlighted that the market consensus is currently underestimating the potential impacts stemming from the devaluation of Argentina's peso and Nigeria's naira. These factors, combined with Brazil's corporate tax adjustments, are anticipated to lead to downgrades in earnings consensus for the year 2024.

Strategic Measures to Drive Earnings Growth

Despite these challenges, AB InBev remains focused on achieving a target range of earnings before interest, taxes, depreciation, and amortization (EBITDA) between 4% and 8% in the medium term. The company is actively working to navigate inflationary pressures by balancing pricing strategies without compromising on sales volumes.

Industry Peer Strategies

Meanwhile, industry peers like Heineken and Carlsberg are also strategizing to drive revenue growth amidst market uncertainties. Heineken has emphasized a focus on revenue growth following a profit decline in 2023 due to higher pricing impacting volumes. However, the company has expressed concerns regarding potential economic and geopolitical volatility affecting its performance in 2024. On the other hand, Carlsberg has increased its long-term revenue growth target of 4%-6% through enhanced investments in marketing and sales activities, particularly in key markets like China, Vietnam, and premium brand segments.

Ensure you adapt your business strategies in response to evolving market dynamics and competitive pressures.