Budweiser Brewing Company APAC (1876) Q2 2024 earnings summary

Executive summary

• 1H24 performance was impacted by a soft industry in China, but strong growth in South Korea and India largely offset this, resulting in flat overall EBITDA and margin expansion year-over-year.

• Revenue declined 4.3% year-over-year to $3,399 million, with total volumes down 6.2% to 46.6 million hl, mainly due to China.

• Premiumization, channel expansion, and digital transformation remain strategic priorities, with continued investment in mega brands, innovation, and capabilities.

• Sustainability initiatives led to a 38% reduction in water usage since 2017 and recognition in S&P Global's 2024 Sustainability China Yearbook.

Financial highlights

• Total volume decreased by 6.2% to 46.6 million hl and revenue declined by 4.3% to $3,399 million year-over-year, mainly due to China.

• Revenue per hectoliter grew by 2%, driven by revenue management and premiumization in China and India.

• Normalized EBITDA decreased by 1% to $1,100 million, but EBITDA margin increased by 109 basis points to 32.4% due to gross margin expansion.

• Cost of sales per hectoliter decreased by 0.6%, supported by cost management and commodity tailwinds.

• Net cash position as of June 30, 2024, was $2.4 billion.

Outlook and guidance

• Second half expected to benefit from a more normalized base, but consumer confidence in China remains soft and weather remains a risk.

• Continued focus on executing mega brand campaigns, innovation in zero sugar and premium segments, and digital expansion.

• Commodity tailwinds and cost management expected to sustain margin improvements in the second half.