AB InBev bouyant for 2020 despite coronavirus risks

The world’s biggest brewer, AB InBev, Thursday forecast a rise in 2020 operating profits despite a difficult first quarter owing to the coronavirus epidemic, which has already cost it $285 million.

The company behind brands like Stella Artois and Budweiser announced 29-percent growth in 2019 net profits to $8.09 billion, helped by the $5-billion listing of its Asian subsidiary in Hong Kong in September.

But the Belgian-Brazilian brewer said it was “not satisfied” with the results and warned of a stormy first quarter because of coronavirus.

“The outbreak has led to a significant decline in demand in China in both on-premise and in-home channels. Additionally, demand during the Chinese New Year was lower than in previous years as it coincided with the beginning of this outbreak,” the company said.

“For the first two months of 2020, we estimate that the outbreak has resulted in lost revenue of approximately $285 million.”

In an unfortunate coincidence for AB InBev, one of its leading lager brands is called Corona.

The company’s debt burden — with which it has been struggling since it bought rival SABMiller in 2016 — remains substantial, standing at $95.5 billion at the end of December compared with $104.2 billion a year earlier.

Nevertheless AB Inbev said it expected its core operating profit to rise by between two and five percent overall this year.

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