Actionable news
0
All posts from Actionable news
Actionable news in BUD: ANHEUSER-BUSCH INBEV SA/NV,

Anheuser-Busch Inbev: Banco Central Do Brasil, Banco Central De La República Argentina,

The following excerpt is from the company's SEC filing.

the Central Bank of China and other central banks;

changes in applicable laws, regulations and taxes in jurisdictions in which we operate, including the laws and regulations governing our operations and changes to tax benefit programs, as well as actions or decisions of courts and regulators;

limitations on our ability to contain costs and expenses;

our expectations with respect to expansion plans, premium growth, accretion to reported earnings, working capital improvements and investment income or cash flow projections;

our ability to continue to introduce competitive new products and services on a timely, cost-effective basis;

the effects of competition and consolidation in the markets in which we operate, which may be influenced by regulation, deregulation or enforcement policies;

changes in consumer spending;

changes in pricing environments;

volatility in the prices of raw materials, commodities and energy;

difficulties in maintaining relationships with employees;

regional or general changes in asset valuations;

greater than expected costs (including taxes) and expenses;

the risk of unexpected consequences resulting from acquisitions, including the combination with Grupo Modelo, joint ventures, strategic alliances, corporate reorganizations or divestiture plans, and our ability to successfully and cost-effectively implement these transactions and integrate the operations of businesses or other assets that we acquired, and the extraction of synergies from the Grupo Modelo combination;

in respect of the proposal to the board of SABMiller, the lack of certainty that the approach in respect of the proposed transaction described herein will result in an offer or agreement, or as to the terms of such agreement;

the outcome of pending and future litigation, investigations and governmental proceedings;

natural and other disasters;

any inability to economically hedge certain risks;

inadequate impairment provisions and loss reserves;

technological changes and threats to cybersecurity;

other statements included in this interim unaudited report that are not historical; and

our success in managing the risks involved in the foregoing.

Our statements regarding financial risks, including interest rate risk, foreign exchange rate risk, commodity risk, asset price risk, equity market risk, counterparty risk, sovereign risk, inflation and deflation, are subject to uncertainty. For example, certain market and financial risk disclosures are dependent on choices about key model characteristics and assumptions and are subject to various limitations. By their nature, certain of the market or financial risk disclosures are only estimates and, as a result, actual future gains and losses could differ materially from those that have been estimated.

We caution that these forward-looking statements are further qualified by the risk factors disclosed in Item 3. Key InformationD. Risk Factors of our 2014 Annual Report that could cause actual results to differ materially from those in the forward-looking statements. Subject to our obligations under Belgian and U.S. law in relation to disclosure and ongoing information, we undertake no obligation to update publicly or revise any

statements, whether as a result of new information, future events or otherwise.

Results of Operations for the Nine-Month Period Ended 30 September 2015 Compared to Nine-Month Period Ended 30 September 2014

The table below presents our condensed consolidated results of operations for the nine-month periods ended 30 September 2015 and 2014:

Nine-month period ended

Change

(USD million, except volumes)

Volumes (thousand hectoliters)

345,893

345,646

Revenue

32,881

35,045

Cost of sales

(13,106)

(14,120)

Gross profit

19,775

20,925

Distribution expenses

(3,214)

(3,424)

Sales and marketing expenses

(5,166)

(5,415)

Administrative expenses

(1,878)

(2,010)

Other operating income/expenses

(28.8)

Exceptional items

Profit from operations

10,306

11,036

EBITDA, as defined

12,686

13,436

The percentage change reflects the improvement (or worsening) of results for the period as a result of the change in each item.

For a discussion of how we use EBITDA, as defined, and its limitations, and a table showing the calculation of our EBITDA, as defined, for the periods shown, see EBITDA, as defined below.

Our reported volumes include both beer and non-beer (primarily carbonated soft drinks) volumes. In addition, volumes include not only brands that we own or license, but also third-party brands that we brew or otherwise produce as a subcontractor and third-party products that we sell through our distribution network, particularly in Europe. Volumes sold by the Global Export & Holding Companies businesses are shown separately.

Effective 1 April 2014, we discontinued the reporting of volumes sold to Constellation Brands under the interim supply agreement, since these volumes do not form part of the underlying performance of our business.

The table below summarizes the volume evolution by zone:

North America

90,834

92,805

(2.1)

Mexico

30,675

28,954

Latin America North

88,165

89,173

(1.1)

Latin America South

25,682

25,779

(0.4)

32,686

34,146

(4.3)

Asia Pacific

72,706

67,062

Global Export & Holding Companies

5,146

7,726

(33.4)

345,893

345,646

Our consolidated volumes for the nine-month period ended 30 September 2015 of 345.9 million hectoliters were flat compared to our consolidated volumes for the nine-month period ended 30 September 2014. The results for the

nine-month period ended 30 September 2015 reflect the performance of our business after the completion of certain acquisitions and disposals we undertook in 2014 and 2015. The 2014 acquisitions include the acquisition of Oriental Brewery, which was included as from 1 April 2014 in our consolidated financial reporting for year ended 31 December 2014, the acquisition of the Siping Ginsber Draft Beer Co., Ltd. and three breweries in China. The 2014 disposals of Comercio y Distribución Modelo and the glass plant located in Piedras Negras, Coahuila, Mexico had an immaterial impact on our consolidated volumes. The 2015 acquisitions and disposals include the termination of certain distribution rights in Europe, the termination of agreements with Crown Imports for the distribution of Grupo Modelo products through some of our company-owned distributors in the United States, and with Monster, for the distribution of its brands in the United States, as well as the disposal of our soft drink business in Peru. Furthermore, our 2015 volumes compared to 2014 volumes were impacted by the discontinuance of the reporting of volumes sold to Constellation Brands mentioned above. These transactions impacted positively our volumes by 2.3 million hectoliters (net) for the nine-month period ended 30 September 2015 compared to the nine-month period ended 30 September 2014.

Excluding volume changes attributable to the acquisitions and disposals described above, total volumes declined 0.6%, with our own beer and non-beer volumes decreasing 0.2% and 4.0%, respectively, in the nine-month period ended 30 September 2015 compared to the nine-month period ended 30 September 2014.

Volumes of our focus brands grew by 0.3% in the nine-month period ended 30 September 2015 compared to the nine-month period ended 30 September 2014. On the same basis, volumes of our three global brands (Budweiser, Corona and Stella Artois) grew by 7.6%. For further information about our focus brands, see B. Business Overview2. Principal Activities and ProductsBeer in our 2014 Annual Report.

North America

In the nine-month period ended 30 September 2015, our volumes in North America decreased by 2.0 million hectoliters, or 2.1%, compared to the nine-month period ended 30 September 2014. Excluding volume changes attributable to the acquisitions and disposals described above, our volumes would have declined by 1.6% compared to the same period in 2014.

We estimate that U.S. industry beer sales-to-retailers adjusted for the number of selling days declined by 0.5% in the nine-month period ended 30 September 2015 compared to the nine-month period ended 30 September 2014. On the same basis, our U.S. shipment volumes and our beer sales-to-retailers adjusted for the number of selling days both declined by 1.9%.

During the nine-month period ended 30 September 2015, we estimate our total U.S. market share, based on sales-to-retailers adjusted for the number of selling days, declined by approximately 65 bps compared to the same period in 2014. We estimated that Budweiser sales-to-retailers adjusted for the number of selling days declined, with the brands share of total market down approximately 15 bps in the nine-month period ended 30 September 2015. On the same basis, we estimate that Bud Lights share of total market was down approximately 35 bps.

In Canada, our beer volumes increased by low single digits during the nine-month period ended 30 September 2015 compared to the same period last year and we estimate that we gained market share.

In the nine-month period ended 30 September 2015, our volumes in Mexico increased by 1.7 million hectoliters, or 5.9%, compared to the nine-month period ended 30 September 2014, driven by a favorable macroeconomic environment, despite a difficult comparable due to the 2014 FIFA World Cup. Corona, Bud Light and Victoria volume performance was especially good. Our focus brands, which represent over 90% of our total volumes, continue to grow ahead of the total portfolio, increasing by 7.6% in the nine-month period ended 30 September 2015 compared to the same period last year.

Latin America North

In the nine-month period ended 30 September 2015, our volumes in Latin America North decreased by 1.0 million hectoliters, or 1.1%, compared to the same period in 2014, with beer volumes decreasing 0.5% and soft drink volumes decreasing 3.0% on the same basis.

In Brazil, our total volumes were down during the nine-month period ended 30 September 2015 compared to the nine-month period ended 30 September 2014, with our beer volumes down 1.5% and our soft drink volumes down 4.7% due to a difficult 2014 FIFA World Cup comparable and an unfavorable macroeconomic environment, partly offset by favorable weather during the third quarter 2015. We estimate that our beer market share was up as compared to last quarter and down year-over-year, reaching a level of 67.8%.

We estimate that volumes of our premium and near beer brands continue to improve, with Budweiser, Stella Artois, Original and Skol Beats Senses growing double digits.

Latin America South

Latin America South volumes for the nine-month period ended 30 September 2015 decreased by 0.1 million hectoliters, or 0.4%. Excluding the acquisitions and disposals described above, our volumes would have increased by 1.5% compared to the same period in 2014, with beer volumes increasing 6.2% and non-beer volumes decreasing 5.6%, On the same basis, our beer volumes in Argentina increased by low single digits as a result of growth of our premium and super-premium brands as well as good performances by our recent innovations.

Europe

Our volumes, including subcontracted volumes, for the nine-month period ended 30 September 2015 decreased by 1.5 million hectoliters, or 4.3%, compared to the nine-month period ended 30 September 2014. Excluding the acquisitions and disposals described above, own beer volumes for the nine-month period ended 30 September 2015 decreased 2.9% compared to the nine-month period ended 30 September 2014, mainly driven by a weak beer industry in Russia and Ukraine. On the same basis, own beer volumes declined by low-single digits in Belgium and Germany mainly as the result of a difficult comparable due to FIFA World Cup activations in 2014, whereas our own products volumes increased by high single digits in the United Kingdom, primarily driven by a strong performance in the off trade channel. We estimate that market share was marginally down in Belgium and flat in Germany and that we gained market share in the United Kingdom.

Asia Pacific

For the nine-month period ended 30 September 2015, our volumes grew 5.6 million hectoliters, or 8.4%, compared to the same period in 2014. Excluding the acquisitions and disposals described above, our total volumes would have been essentially flat over the same period. On the same basis, our beer volumes in China grew by 0.7%.

We estimate that the total industry volumes in China declined by approximately 5.5% in the nine-month period ended 30 September 2015. Industry volumes were impacted by continuing economic headwinds and poor weather during the second and third quarters 2015...


More