Remarkably, and in stark contrast to its main competitors, Q1 beer volumes rose by 1.2% y-o-y. This overshadowed a 1.9% decline in volumes in the non-beer segment, which it should be noted, represents under 1/6 of consolidated revenue.
This positive development was accompanied by further price hikes that were fairly well accepted by the market, resulting in a 5.8% y-o-y increase in revenue. Operating profit grew by 7.1%, with margins that remain incomparably higher - nearly double - those of peers such as Heineken and Carlsberg.
Managed with clinical efficiency, the owner of brands like Budweiser, Corona and Stella Artois, is fully leveraging the economies of scale facilitated by a business scope that is unparalleled by its two European rivals: its $59bn revenue in 2024 was more than double that of the Dutch brewer and quadruple that of its Danish counterpart.
It should be noted, however, that in Q1 volume growth was driven by the Central America region, which currently represents 29% of AB InBev's consolidated revenue, and to a lesser extent by the Europe and Middle East region. In North and South America, as well as in the Asia-Pacific region, volumes continue to fall.
Regarding its market share, AB InBev remains the leader in eight of the world's ten largest markets and is by far the most profitable group in the alcohol and spirits sector. Indeed, the company was recovering under the combined effect of repeated price increases and a reduction in its debt, which had reached significant levels following its $100bn+ acquisition of SAB Miller a decade ago.
However, its situation is still subject to caution. Adjusted for inflation, both revenue and operating profit have stagnated over the past five years. Nevertheless, a reduction in the capex program following the 2021 peak has boosted its free cash flow, which hovered around $10bn last year.
With a market capitalization of $123bn and net debt of $60bn, deleveraging naturally remains a priority regarding capital allocation. However, this is not expected to prevent the group from returning $7bn to shareholders for FY 2025, one-third of which is slated for share buybacks.
