BY BRIDGET MACDONALD – MEDILL NEWS SERVICE
Not only does Belgium boast over 450 varieties of beer – each served in a specific glass designed to showcase its flavor – it is home to the largest brewer in the world.
Budweiser calls itself the king of beer, but parent company Anheuser-Busch InBev NV [[ABI]], headquartered in the Kingdom of Belgium, reigns supreme.
Brussels-based InBev acquired Anheuser-Busch last July, usurping the title of No. 1 beer maker from rival SABMiller Plc [[SAB]] of London. Over the past year, InBev has gained market share in seven of its key markets, including Belgium, Germany, the United Kingdom and the U.S.
In its fiscal fourth quarter, the company reported its profits nearly doubled from the year earlier period, citing the strategic sale of Korean brewer Tsingtao in addition to the lucrative AB acquisition. Profits climbed to $716 million in the quarter from $373 million a year ago.
Paying heed to the challenging operating landscape, CEO Carlos Brito said in the company’s May 3 earnings release that 2009 is off to a relatively good start, adding, “We remain committed to investing significant financial and marketing resources on our Focus Brands to drive sustained profitable growth.”
“Focus Brands” include Bud Light and Stella Artois, both of which performed well in the latest quarter. Shipments of Stella increased 37 percent in the United States, the world’s biggest beer market, while economical brands like Bud Light have edged out pricier competitors among budget-minded beer drinkers.
Morgan Stanley analyst Michael Steib said in a research note, quoted May 20 by Bloomberg News, that AB InBev will offer “superior earnings growth coupled with superior returns” on improved margins, costs savings, and the strength of the Bud Light brand.
For those with more discerning tastes, InBev’s brands include more traditional Belgian-style brews like Hoegaarden and Leffe as well. And the impending summer heat promises to entice consumers of all palettes and persuasions who are thirsting for a cold one.
Along with the rise of its dominant brewing industry, Belgium has seen a resurgence of small, traditional breweries. According to the official Brussels Tourism Website, there are an estimated 100 breweries in Belgium. If nothing else, the annual shareholders’ meeting in Brussels makes InBev a worthy investment for any beer connoisseur.
Cheers! Or as the Flemish say, Op uw gezondheid!