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Anheuser-Busch InBev SA/NV Management Discusses Q2 2012 Results - Earnings Call Transcript

Stocks in this article: BUD

Our global brands of Budweiser, Stella Artois and Beck's grew collectively by 2% in the quarter. Global Budweiser trends remain strong. Volume is growing by 5.2% in the quarter and 6.2% year-to-date. Budweiser brand health in the U.S. continues to improve, and we saw a strong performance, as in most of our key markets around the world. This includes a double-digit volume growth in China and Russia; solid execution behind the FA Cup sponsorship in the U.K., which helped the brand to gain share in the first half; and a good reception for the brand when it was launched in Ukraine in April. In Brazil, Budweiser continues to exceed expectations after its launch in August last year and has played an important role in our premium brand portfolio strategy.

Stella Artois global volumes came under pressure in the first quarter, declining by 3.5% due to weak weather-driven U.K. industry and competitive off-trade pressure as well as softer shipments in the U.S. due to the shipping pattern adjustments I mentioned earlier. However, the underlying performance in the U.S. continues to be strong, with STRs growing by 18% in the quarter. We also saw volume growth in Argentina, Brazil and Russia. We continue to see good growth from Stella Artois Cidre in the U.K., up 20% in the quarter. Beck's volumes declined in the quarter as a result of a weak German industry, though we grew share in that market.

Turning now to our top 3 markets and firstly, the U.S. We're encouraged by industry trends, with the first 6 months of the year seeing the best industry performance since 2008. As you know, the first quarter was helped by favorable weather and an improving economy, and the momentum continued into the second quarter with our innovations being a key driver. We estimate that industry's selling day adjusted STRs grew by 0.4% in the quarter and by 0.8% year-to-date, and the positive industry trend appears to have carried through into July based on ROI data for the 2 weeks ending July 15. Our own selling day adjusted STRs in the quarter were marginally down at minus 0.2% but ahead by plus 0.2% for the half year with market share trends continuing to improve. We estimate share was down 30 basis points in the quarter and 25 basis points in the half year.

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