A-B Reports Sales Increase, Sets Sights on Future
ST. LOUIS -- Strong domestic beer revenues and earnings have contributed to Anheuser-Busch's (A-B) net sales increasing 4.7 percent, totaling $4.28 billion for the third quarter of 2006. In addition, for the nine months of 2006, net sales increased 5.3 percent.
Earnings growth for A-B's domestic beer business gained momentum this quarter, with its pretax income up 7 percent and domestic beer sales increasing 3.9 percent. Beer shipments to wholesalers rose 1.1 percent to 27.5 million barrels, while revenue per barrel increased 2.8 percent versus last year's third quarter. For all of A-B's brands, barrels shipped rose 1.2 percent to 43.2 million barrels for the third quarter. The company's net income totaled $638 million, an increase of 26.3 percent over the third quarter of 2005.
Sales to retailers decreased .4 percent, while the brands Rolling Rock, Grolsch and Tiger added .8 points of growth to shipments and sales to retailer volume. For the year to date, sales to retailers increased .9 percent, led by Bud Light, which grew over 4 percent. Domestic market share year to date totaled 49 percent, up from 2005's market share of 48.9 percent.
"We are pleased with our earnings results to date," said Patrick Stokes, A-B's president and chief executive. "Productivity improvement initiatives, along with somewhat lesser energy cost increases have helped mitigate continuing cost pressures."
"In addition," Stokes continued, "our international beer segment, led by Grupo Modelo, and our entertainment segment are having outstanding years. We expect Anheuser-Busch's positive performance to continue through the end of the year and our earnings to continue to improve in 2007."
Following pricing plans for 2006, A-B will begin price increases on the majority of its beer volume in early 2007, with a few select brands seeing the increase in late 2006. The pricing will apply to select markets, brands and packages.
In other A-B news, its multi-year contract to sponsor the World Poker Tour’s Season V has been renewed. The contract began in the tournament's second season with A-B's World Lager being the first official sponsor and official beer of the tournament. Last year, the company increased sponsorship by promoting its Budweiser brand with the tour.
The re-signed contract still provides for A-B brands to be the tour's "Official Beer," in addition to a feature in the televised final winner table toasts with hosts Sabina Gadecki, Mike Sexton and Vince Van Patten.
"Budweiser is a classic American beer meant to be shared with friends over a great game of poker," said Randall Blackford, director of Budweiser marketing for A-B. "The World Poker Tour continues to deliver the best poker tournaments and poker programming on television, and we are pleased to be back in action for Season V."
Looking towards the holiday season, A-B also is releasing a line of limited-edition beers, including Michelob Celebrate Vanilla Oak, Michelob Celebrate Chocolate and Budweiser Brew Masters' Private Reserve.
"Whether it's the subtle hint of vanilla, notes of chocolate or the aroma of hops, this year's seasonal beers offer a variety of choices for special occasions this season," said Kristi Zantop, brewmaster, A-B. "Brewing with winter-inspired ingredients like cocoa and vanilla lets us create beers that are the perfect accompaniment to holiday meals, parties or sitting in front of the fire."
Michelob Celebrate Chocolate is the company's latest seasonal brew. Brewed with caramel malts, roasted malts and aged on cocoa beans, the beer has a dark chocolate color and aroma and contains 8.5 percent alcohol by volume.
Michelob Celebrate Vanilla Oak features distinct flavors of vanilla, caramel and aged oak for a full bodied, balanced brew. The beer is brewed with two-row barley, caramel malts, carapils malts and imported hops. Aged on whole vanilla beans and bourbon barrel oak, the beer compliments desserts or works well as an after-dinner drink and contains 10 percent alcohol by volume.
Budweiser Brew Masters' Private Reserve is a full-bodied malt lager with a honey color. The reserve is based on a company tradition of collecting the richest selections of the beer as it is tapped to celebrate the holiday season. The full-flavor beer contains 8.5 percent alcohol by volume.
Michelob Celebrate Vanilla Oak and Chocolate are available in 24-ounce glass bottles that are designed for sharing. Also available as a set for gift-giving, the Celebrate flavors include two 13.5-ounce Ritzenhoff Crystal snifters and a 24-ounce bottle of each flavor. Budweiser Brew Masters' Private Reserve is available in a 46.5-ounce magnum and a 32-ounce bottle, both with swing top closures.
Earnings growth for A-B's domestic beer business gained momentum this quarter, with its pretax income up 7 percent and domestic beer sales increasing 3.9 percent. Beer shipments to wholesalers rose 1.1 percent to 27.5 million barrels, while revenue per barrel increased 2.8 percent versus last year's third quarter. For all of A-B's brands, barrels shipped rose 1.2 percent to 43.2 million barrels for the third quarter. The company's net income totaled $638 million, an increase of 26.3 percent over the third quarter of 2005.
Sales to retailers decreased .4 percent, while the brands Rolling Rock, Grolsch and Tiger added .8 points of growth to shipments and sales to retailer volume. For the year to date, sales to retailers increased .9 percent, led by Bud Light, which grew over 4 percent. Domestic market share year to date totaled 49 percent, up from 2005's market share of 48.9 percent.
"We are pleased with our earnings results to date," said Patrick Stokes, A-B's president and chief executive. "Productivity improvement initiatives, along with somewhat lesser energy cost increases have helped mitigate continuing cost pressures."
"In addition," Stokes continued, "our international beer segment, led by Grupo Modelo, and our entertainment segment are having outstanding years. We expect Anheuser-Busch's positive performance to continue through the end of the year and our earnings to continue to improve in 2007."
Following pricing plans for 2006, A-B will begin price increases on the majority of its beer volume in early 2007, with a few select brands seeing the increase in late 2006. The pricing will apply to select markets, brands and packages.
In other A-B news, its multi-year contract to sponsor the World Poker Tour’s Season V has been renewed. The contract began in the tournament's second season with A-B's World Lager being the first official sponsor and official beer of the tournament. Last year, the company increased sponsorship by promoting its Budweiser brand with the tour.
The re-signed contract still provides for A-B brands to be the tour's "Official Beer," in addition to a feature in the televised final winner table toasts with hosts Sabina Gadecki, Mike Sexton and Vince Van Patten.
"Budweiser is a classic American beer meant to be shared with friends over a great game of poker," said Randall Blackford, director of Budweiser marketing for A-B. "The World Poker Tour continues to deliver the best poker tournaments and poker programming on television, and we are pleased to be back in action for Season V."
Looking towards the holiday season, A-B also is releasing a line of limited-edition beers, including Michelob Celebrate Vanilla Oak, Michelob Celebrate Chocolate and Budweiser Brew Masters' Private Reserve.
"Whether it's the subtle hint of vanilla, notes of chocolate or the aroma of hops, this year's seasonal beers offer a variety of choices for special occasions this season," said Kristi Zantop, brewmaster, A-B. "Brewing with winter-inspired ingredients like cocoa and vanilla lets us create beers that are the perfect accompaniment to holiday meals, parties or sitting in front of the fire."
Michelob Celebrate Chocolate is the company's latest seasonal brew. Brewed with caramel malts, roasted malts and aged on cocoa beans, the beer has a dark chocolate color and aroma and contains 8.5 percent alcohol by volume.
Michelob Celebrate Vanilla Oak features distinct flavors of vanilla, caramel and aged oak for a full bodied, balanced brew. The beer is brewed with two-row barley, caramel malts, carapils malts and imported hops. Aged on whole vanilla beans and bourbon barrel oak, the beer compliments desserts or works well as an after-dinner drink and contains 10 percent alcohol by volume.
Budweiser Brew Masters' Private Reserve is a full-bodied malt lager with a honey color. The reserve is based on a company tradition of collecting the richest selections of the beer as it is tapped to celebrate the holiday season. The full-flavor beer contains 8.5 percent alcohol by volume.
Michelob Celebrate Vanilla Oak and Chocolate are available in 24-ounce glass bottles that are designed for sharing. Also available as a set for gift-giving, the Celebrate flavors include two 13.5-ounce Ritzenhoff Crystal snifters and a 24-ounce bottle of each flavor. Budweiser Brew Masters' Private Reserve is available in a 46.5-ounce magnum and a 32-ounce bottle, both with swing top closures.