AB Inbev (BUD) 4th Quarter 2015 Earnings Call Notes

AB Inbev (BUD) CEO Carlos Brito explained his strategic priorities 

In order to continue to accelerate top line growth, we have developed a deep understanding of consumer’s needs and occasions. These insights have enabled us to identify four commercial priorities, which are relevant across the whole of our business.  First, growing our global brands involves leveraging the potential of Budweiser, Stella Artois and Corona. Second, premiumizing and invigorating beer is all about creating excitement and aspiration in beer, especially with millennials by bringing new energy and variety to the beer experience.  Third, elevating the core is about raising the perception and relevance of our major core brands through differentiated messaging and large scale activations. And finally, developing the near beer segment gives us an opportunity to compete for a greater share of total alcohol.”

AB Inbev (BUD) CEO Carlos Brito talked about what’s ailing the Bud Light brand

“I think in a market as fragmented as the U.S. to have a brand with 18%, 19% market share is already an amazing thing in itself. On the other hand, I mean people want to grow. Of course they all target the big guy with the most of the shares. So that’s one thing. I think the second thing is that for a number of years, the past few years, we have not afforded the brand. We have not given the brand to support an 18%, 19% share brand in the U.S. market, fragmented U.S. and competitive fragmented U.S. market deserves and I think now we’re beginning to rebuild that.  So for example, Budweiser has always been very connected to culture and fun in a smart way. At some point it becomes fun, but maybe in a more not so smart way. So we’re trying to recover that because when we go back and see what made the brand what it is today, we’re trying to recover not only the packaging and cues and communication, trying to recover a little bit of the, let’s say, the founders’ spirit of the brand of 20-plus years ago.”

AB Inbev (BUD) CEO Carlos Brito spoke about investing in some emerging market countries in which growth is slowing

“And in terms of crisis in some countries, that’s when we feel even more excited about investing, because that’s when competition normally takes the foot off the pedal. And in our history we’ve seen many times when we’ve either penetrated or acquired businesses during tough times in some countries where everybody was exiting, or whether – or when we press the pedal harder when everybody was taking their foot off the accelerator.”

AB Inbev (BUD) CEO Carlos Brito said their company has controlled about 2/3’s of the Brazilian beer market for the last 15 years

Our market share in the year was 67.5% according to Nielsen. That’s within our 67% to 69% range. And as you said, last year was a year of margins and profitabilities. So nothing strange in having the share more towards the bottom of the range. We’ve had this range now for, I don’t know, over 15 years, and it’s always the same story.”