Brazil: Ambev sees 10.9% decline in Q4 net profit as total volumes were slightly down
Brazilian brewer Ambev reported on February 29 a decline of 10.9% in fourth-quarter net profit, missing market forecasts as total volumes were down slightly by 0.1%, dragged down by South America and Canada.
The subsidiary of Belgium's Anheuser-Busch InBev posted a profit of 4.53 billion reais ($911.93 million), versus the 4.64 billion real average estimate of analysts polled by LSEG.
Revenue also decreased by about 12% from the same period a year earlier to 19.99 billion reais ($4.02 billion), missing the consensus view of 22.14 billion real ($4.46 billion).
Earnings before interest, tax, depreciation and amortization (EBITDA) grew slightly by 0.6% to 7.15 billion reais ($1.44 billion).
The company said currency and commodity trends, plus lower interest rates, were reducing cost pressures in Brazil. This year, it expects costs per hectolitre of beer, excluding non-Ambev products, to drop up to 3.0%.
In Brazil, annual sales grew, reaching the mid-twenties, attributed to the popularity of brands like Corona, Spaten, and Original. However, this growth was tempered by a drop of 1.1% in volumes quarter-on-quarter, largely due to a challenging comparison period during the FIFA World Cup.
In South America, volumes also fell by 3.8%, quarter on quarter, driven by Argentina, where highly inflationary pressures affect overall consumer demand. And in Canada, volume shortfall was driven by a challenging industry situation, affecting top and bottom line performances in the quarter.
On the other hand, the Central America and Caribbean (CAC) region showed a promising recovery trend, with double-digit growth in both top and bottom lines, led particularly by the Dominican Republic.
Ambev is Brazil's fourth-largest company by market capitalization, behind oil giant Petrobras, miner Vale, and lender Itau.
($1=4.9675 reais)
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