The Wall Street Journal is reporting that sales of beer have gone flat in emerging countries. You can read the full article here. The author, David Kesodel says that beer sales in emerging economies are cooling, sapping a key source of profit growth. The abrupt weakness, especially in Eastern Europe, is putting pressure on brewers’ profits and could accelerate consolidation in an industry that has seen several multibillion-dollar deals in the past few years. Here is an outake:
InBev NV, the brewer of Stella Artois and Beck’s, said Thursday that beer unit volume in Russia dropped 11 percent in the third quarter, compared with a 14 percent increase a year earlier. Volume in Brazil rose just 1.1 percent. InBev, based in Leuven, Belgium, said net income fell 14 percent to <euro>447 million ($557.4 million). Revenue rose 4.5 percent to <euro>3.95 billion.
Carlsberg AS Wednesday said unit volume in Russia, where it has a major presence, fell 1 percent in the third quarter.
And London’s SABMiller PLC – which has one of the heaviest presences in developing markets – next week is expected to report slowing growth in some of its markets when it reports earnings. Three of its worst-performing markets are Russia, Colombia and South Africa.