InBev sees recovery in sales of Stella
Beer giant InBev today said the UK remained its most challenging market in western Europe, despite sales of Stella Artois recovering over the summer.
InBev said an improved performance in the UK was the reason why volumes of its flagship brand rose 8.4% between July and September after sliding 3.9% over the previous three months.
The turnaround was achieved even though InBev has refused to cut the price of pints of Stella because it would devalue its image as a “reassuringly expensive” lager.
A spokeswoman for the Belgian brewer said sunny weather in the key month of September lay behind the 7.6% rise in volumes of Stella in the UK during the third quarter.
At the same time, InBev put more emphasis on marketing the lager with adverts featuring ice-skating priests and a black-and-white film in the mould of surrealist movies by Salvador Dali.
“It’s our belief that our actions are starting to pay off, but it will take longer to get Stella Artois back to where we want it to be,” the spokeswoman said.
She added that comparisons in the third quarter were easier than between April and June, when the company was up against the strong sales last year during the Euro 2004 football championships.
As well as Stella, InBev’s brands include German lager Beck’s, Czech beer Staropramen, ale Bass, Leffe and Hoegaarden.
InBev employs about 3,000 people in the UK at its British head office in Luton and its three breweries, in Glasgow, near Preston and in south Wales.
The group said beer volumes lifted by 6.8% in the third quarter against the same period of 2004, with its flagship brands growing almost twice as fast – up by 12%.
Demand was strong in China, Russia, Ukraine, Romania and Bulgaria and this helped to offset challenging trading conditions in Canada and the United States, where a price war erupted earlier this year.
Earnings before interest, tax, depreciation and amortisation in the quarter was 11.7% ahead of last year at €966m.
Leuven-based InBev, formerly known as Interbrew, bought the UK operations of Bass Brewers in 2000 for £2.3bn (€3.4bn).
However, the Competition Commission objected to the acquisition and Interbrew later sold the business, apart from the Bass bitter and Tennents lager brands and Bass’ operations in Northern Ireland and Scotland, to US brewer Coors.
