AB InBev’s UK division faces widening losses even after price hikes.
- The UK arm reported a pre-tax loss of £72.1m in 2023.
- Sales rose slightly from £1.59bn to £1.66bn during the same period.
- Challenges cited include inflation, supply chain issues, and decreased income.
- Global performance contrasts with UK’s economic struggles.
AB InBev’s UK division has reported an increase in losses for the latest financial year, despite efforts to offset costs through price raises. The company, known for brands like Budweiser, Corona, and Stella Artois, documented a pre-tax loss of £72.1 million in 2023. This loss came in the wake of a previous year’s loss of £89.5 million, and marks a continuation of a downward trend since experiencing a profit of £40.9 million in 2020.
Despite the increase in sales from £1.59 billion to £1.66 billion, the company’s financial performance remained underwhelming. The board attributed these figures to a series of economic adversities, primarily pointing to persistent inflation, supply chain disruptions, and reduced household incomes. Such factors have necessitated agile management and strategic pricing adjustments to navigate the challenging market conditions.
The beer industry, particularly the off-trade sector that includes supermarkets and convenience stores, has faced a downturn in performance, exacerbated by rising consumer prices and government-imposed beer duty hikes since August. Although the off-trade grocery segment showed signs of stability, it continued to perform below pre-pandemic levels.
In contrast to the UK’s performance, AB InBev globally experienced a positive first quarter with an underlying profit of £1.2 billion, a notable increase from £1.05 billion in the same period the previous year. CEO Michel Doukeris highlighted the success of pricing strategies and a strong beer category, reflecting a stark difference from the challenges faced within the UK market.
The contrasting performances underscore the UK division’s struggle amid broader economic challenges.
