Poor Asia Pacific sales drag down AB InBev volumes

Anheuser-Busch InBev (AB InBev) has said beer volumes fell more than expected in the third quarter as a consumer spending slowdown leads drinkers to buy cheaper beer.

Beer sales volumes fell 2.4% in the third quarter for brewing giant AB InBev.

Continued weaker sales in China and Argentina were partly to blame for the drop. In China, where AB InBev sells global brands as well as local beers such as Sedrin and Harbin, sales fell 16.1% during the quarter, largely due to poor performance in bars and restaurants as consumers cut back, the company said.

Sales in Argentina were hit by inflationary pressure which hurt spending.

The company, which owns global brands including Budweiser, Stella Artois and Beck’s, has invested in marketing to push its beer brands, including Michelob, which sponsored Team USA at the Paris Olympics.

AB InBev’s third quarter was “weak but not terrible”, according to James Edwardes Jones, an analyst at RBC Capital Markets. However, he noted that China was very soft, according to Bloomberg. The company also announced a share buyback of $2 billion over the next 12 months.

The brewer, headquartered in Belgium, is not the only one suffering from a consumer downturn in China. Yesterday Reuters reported that Carlsberg, the maker of Kronenbourg 1664, Tuborg and Somersby, said beer sales volumes fell by 1.3% in the third quarter, noting declines in China, France and the UK.

“In Western Europe, there’s no doubt that the average consumer is holding back,” CEO Jacob Aarup-Andersen told Reuters.

“In Asia, China stands out as a market where the consumer is very weak. Most other Asian markets are actually okay,” he said, adding the company had not yet seen Chinese stimulus measures having any impact on consumer behaviour.

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