New book by Larry Connors Click here Improve your trading - See how
The St. Louis, Missouri-based company reported net income for the third quarter of $666.1 million or $0.90 per share, compared to $706.7 million or $0.95 per share for the year-ago quarter.
The latest quarter results include a pretax gain of $15.3 million from the sale of U.S. distribution rights to Grolsch and pretax charges of $166.2 million for outside professional services related to its sale to InBev and for costs associated with a retirement program.
Excluding items, adjusted net income for the current year third quarter was $782.2 million or $1.05 per share.
On average, 8 analysts polled by First Call / Thomson Financial expected the company to earn $1.04 per share for the third quarter. Analyst estimates typically exclude special items.
Gross profit for the third quarter increased to $1.90 billion from $1.75 billion in the prior year quarter. Operating profit, which include the corporate charges and gain on sale of distribution rights, fell to $939.8 million from $998.3 million a year ago.
Equity income for the quarter fell 5.9% to $174.2 million from $185.2 million a year earlier.
Anheuser-Busch, maker Budweiser and Michelob, said net sales for the third quarter rose 6.5% to $4.92 billion from $4.62 billion in the same quarter, driven by growth in U.S. beer sales, international beer sales and entertainment operations. Six analysts had a consensus revenue estimate of $4.88 billion for the third quarter.
Third quarter U.S. beer sales increased 6.6%, mainly due to 2.3% higher beer shipments volume as well as a 3.7% increase in revenue per barrel resulting from price increases and favorable brand mix.
The company implemented price increases on the majority of its U.S. beer volume in September and October. The pricing initiatives covered about 85% of the company's domestic volume and were tailored to selected markets, brands and packages.
U.S. beer shipments to wholesalers increased 2.3% for the third quarter, while sales to retailers increased 3.6%.
August A. Busch IV, president and chief executive officer of the company, said U.S. sales volume were driven by the introduction of Bud Light Lime. The Bud Light brand and super-premium Michelob Ultra family also made important contributions to growth, as did recent new products like Chelada and Landshark, he added. According to IRI supermarket data, Anheuser-Busch increased its market share by 0.9 percentage point in the third quarter.
The company's estimated U.S. beer market share for the nine months of 2008 was 49.2% compared to 49% for the prior year period.
The company said it expects to achieve revenue per barrel growth of 4% for 2008, including favorable brand mix.
Third quarter international beer net sales increased 18.6% mainly on higher sales volume, increased pricing and favorable brand mix.
Packaging segment sales for the quarter grew 0.4% due to increased recycling revenues partially offset by lower aluminum can sales and entertainment sales increased 6.8% mainly from higher attendance and increased ticket pricing.
For the first nine months of the year, Anheuser-Busch reported net income of $1.87 billion or $2.55 per share, compared to $1.90 billion or $2.49 per share for the same period last year.
Excluding items, adjusted net income for the nine-month period was $1.98 billion or $2.70 per share, compared to $1.89 billion or $2.48 per share in the prior year period.
Net sales for the nine-month period increased to $13.74 billion from $12.99 billion in the comparable year-ago period.
Anheuser-Busch today did not provide any information on its pending sale to InBev. But InBev, which also reported earnings earlier Thursday, said that the $52 billion takeover was on track to close by the end of the year despite market turmoil that forced it to postpone a $9.8 billion rights issue last month.
Anheuser-Busch shareholders are scheduled to vote on the deal next Wednesday. InBev shareholders have already approved the deal last month.
In July, Anheuser-Busch agreed to be bought by InBev for $52 billion in a deal that would create the world's largest brewer. The combined company will be called Anheuser-Busch InBev, which will have about 300 brands and annual net sales of $36 billion.
About 40% of the combined company's revenues will be generated in the U.S. and all of Anheuser-Busch's U.S. breweries will remain open. The U.S. beer market, valued at about $97 billion, is the second largest in the world by volume, next to China. Beer tops the list of alcoholic beverages in the U.S. with a 57% market share.
Tough economic conditions and the insatiable thirst to increase market share have encouraged consolidation in the brewing sector. London-based SAB acquired North American brewer Miller Brewing from Philip Morris group for $5.6 billion in 2002 to form SABMiller (SAB.L | Quote | Chart | News | PowerRating).
InBev itself is the product of a merger between Belgium's Interbrew and Brazil's Am-Bev. In March 2004, Interbrew, which was then the world's No.3 beer firm acquired Am-Bev, ranked No.5, for $11.5 billion in a share swap deal.
In February 2005, U.S.-based Adolph Coors Co. and Canadian brewer Molson Inc. merged to form Molson Coors Brewing Co. (TAP | Quote | Chart | News | PowerRating) and now has about 11% share in the U.S. beer market. Coors acquired Molson for $3.4 billion.
As recently as October 2007, SABMiller and Molson Coors revealed their plans to combine their U.S. operations in order to better compete with Anheuser-Busch and increase their market share in the U.S. The joint venture will operate under the name MillerCoors and will have a market share of about 30%.
Early this year, British brewer Scottish & Newcastle agreed to a buyout by its rivals Heineken and Carlsberg for $15.4 billion.
Anheuser-Busch shares are currently trading at $64.49, up 86 cents or 1.35%. The shares are trading in a 52-week range of $45.55 to $68.58.
For comments and feedback: contact editorial@rttnews.com Copyright(c) 2008 RealTimeTraders.com, Inc. All Rights Reserved
More News:
Market Updates |
Stock Alerts |
All Trading News |
Stock Index
About TradingMarkets | Contact | Advertise | Careers | Link to Us | Site Map | Help | Terms & Conditions | Privacy Policy | Return Policy | Testimonials | Feedback
The Connors Group, Inc. ("Company") is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. The analysts and employees or affiliates of Company may hold positions in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in trading securities and/or currencies. The Company, the authors, the publisher, and all affiliates of Company assume no responsibility or liability for your trading and investment results. Factual statements on the Company's website, or in its publications, are made as of the date stated and are subject to change without notice.
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results of any individual trader or trading system published by Company are not indicative of future returns by that trader or system, and are not indicative of future returns which be realized by you. In addition, the indicators, strategies, columns, articles and all other features of Company's products (collectively, the "Information") are provided for informational and educational purposes only and should not be construed as investment advice. Examples presented on Company's website are for educational purposes only. Such set-ups are not solicitations of any order to buy or sell. Accordingly, you should not rely solely on the Information in making any investment. Rather, you should use the Information only as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments. You should always check with your licensed financial advisor and tax advisor to determine the suitability of any investment.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING AND MAY NOT BE IMPACTED BY BROKERAGE AND OTHER SLIPPAGE FEES. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.
The Connors Group, Inc.
15260 Ventura Blvd., Ste. 2200
Sherman Oaks, CA 91403
© Copyright 2009 The Connors Group, Inc.
