Budweiser Brewing Co. APAC Shares Fall on Worries Over 1Q Results
By Tracy Qu
Budweiser Brewing Co. APAC shares are sharply lower amid concerns over its first-quarter results as subdued Chinese consumer sentiment continues to hurt consumption.
The stock fell as much as 7.3% in the morning and were last down 6.4% at 10.50 Hong Kong dollars (US$1.34), taking this year's losses to 28%.
Budweiser's management, in a investors' call after the market closed Friday, said its China sales volumes in March were weaker than in the first two months of the year, according to Citi. China sales represent about 40% of the first quarter volumes, said Citi analysts led by Xiaopo Wei in a note to clients.
That doesn't bode well the first quarter results for the company, a unit of Anheuser-Busch InBev, which are typically announced in May.
Budweiser's first-quarter performance is also likely to be hit by last year's high base and sales volume pressure as weakness in the economy curbs spending by price-sensitive lower-income consumer groups, Citi's report said, citing the management.
Management added that South Korean sales were also likely to be weak due to last year's high base of comparison, Citi said.
The company's revenue in the first quarter of last year were strong as consumption in China and the rest of Asia picked up with the lifting the pandemic-related curbs.
Jefferies also expects first-quarter sales volumes in China to be under pressure and forecasts they will fall 6%. Still, analysts at the investment bank said gross profits will likely to be lifted by the company's shift toward higher-premium products.
Write to Tracy Qu at tracy.qu@wsj.com
(END) Dow Jones Newswires
April 08, 2024 02:23 ET (06:23 GMT)
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