Why Bud Light Parent AB InBev Shares Are Taking A Hit Today

Anheuser-Busch InBev SA/NV BUD reported fourth-quarter fiscal 2023 revenue growth of 6.2% organic year-over-year to $14.473 billion, missing the consensus of $15.49 billion.

Total volumes declined by 2.6%, with own beer volumes down by 3.6% and non-beer volumes up by 3%. Revenue per hl grew 9.3%.

The company had about 70% of its revenue through B2B digital platforms and over $550 million revenue was generated by the digital direct-to-consumer ecosystem.

Gross profit for the quarter declined to $7.794 billion (up 5.3% organically), and gross margin contracted 49 basis points to 53.9%.

Normalized EBITDA for the quarter grew 6.2% organically to $4.88 billion, with the margin almost flat at 33.7%.

The underlying profit for the quarter was $1.66 billion compared to $1.74 billion last year. Underlying EPS of $0.82, down from $0.86 YoY, beating the consensus of $0.78.

U.S. revenues declined by 17.3% Y/Y, with sales-to-retailers down by 12.1%, primarily due to the volume decline of Bud Light.

Net debt to normalized EBITDA ratio was 3.38x on December 31, 2023, compared to 3.51x a year ago.

As of February 23, 2024, $870 million of the $1 billion share repurchase program announced on October 31, 2023, has been executed.

As of December 31, 2023, the company had a total liquidity of $20.5 billion, which consisted of $10.1 billion available under committed long-term credit facilities and $10.4 billion of cash, cash equivalents, and short-term investments in debt securities less bank overdrafts.

2024 Outlook: AB InBev expects EBITDA to grow in line with a medium-term outlook of 4-8%. It expects capital expenditure of $4 billion – $4.5 billion.

Price Action: BUD shares are trading lower by 3.28% at $60.40 on the last check Thursday.

Photo via Shutterstock