To view the PDF file, sign up for a MySharenet subscription.

ANHEUSER-BUSCH INBEV SA/NV - Anheuser-Busch InBev reports Second Quarter and Half Year 2017 Results

Release Date: 27/07/2017 07:15
Code(s): ANH     PDF:  
Wrap Text
Anheuser-Busch InBev reports Second Quarter and Half Year 2017 Results

      Anheuser-Busch InBev SA/NV
      (Incorporated in the Kingdom of Belgium)
      Register of Companies Number: 0417.497.106
      Euronext Brussels Share Code: ABI
      Mexican Stock Exchange Share Code: ANB
      NYSE ADS Code: BUD
      JSE Share Code: ANH
      ISIN: BE0974293251
      (“AB InBev”)

      The enclosed information constitutes regulated information as defined in the Belgian Royal Decree of 14 November 2007 regarding the duties of
      issuers of financial instruments which have been admitted for trading on a regulated market.
      Except where otherwise stated, the comments below are based on organic growth figures and refer to 2Q17 versus the reference base for the same
      period of last year. For a description of the reference base and important disclaimers please refer to pages 14 and 15.




                         Anheuser-Busch InBev reports Second Quarter and
                                     Half Year 2017 Results
       HIGHLIGHTS
      Revenue: Revenue grew by 5.0% in the quarter, with revenue per hl growth of 3.2%. On a constant
      geographic basis, revenue per hl grew by 3.6%, driven by revenue management initiatives as well as
      continued premiumization. In HY17, revenue grew by 4.4% with revenue per hl growth of 4.2%. On a
      constant geographic basis, revenue per hl grew by 4.1%.
      Volume: Total volumes grew 1.0%, while own beer volumes were up by 2.1%. Good growth in own beer
      volumes was achieved in South Africa, Mexico and Australia, while declines were recorded in the US, Brazil
      and Colombia. In HY17, total volumes were up 0.3% with own beer volumes up 1.0%.
      Global Brands: Combined revenues of our three global brands, Budweiser, Stella Artois and Corona, grew
      by 8.9% in 2Q17. Budweiser revenues grew by 5.7%, with 11.7% growth in revenues outside of the US.
      Stella Artois revenues grew by 6.6%, driven mainly by growth in Argentina and South Korea. Corona had
      a solid quarter as well, with revenues growing 16.6%, with 26.2% growth in revenues outside of Mexico, as
      a result of strong growth in the UK, Australia and China. In HY17, the combined revenues of our global
      brands grew by 10.6%.
      Cost of Sales (CoS): CoS increased by 3.2% in 2Q17 and by 1.3% on a per hl basis. On a constant
      geographic basis, CoS per hl increased by 2.2%, with savings from synergies partially offset by the
      anticipated transactional currency and commodity impacts in Latin America North and Latin America South.
      In HY17, CoS grew by 4.3% in dollars and by 4.2% on a per hl basis. On a constant geographic basis, CoS
      per hl increased by 4.3% in HY17.
      EBITDA: EBITDA grew by 11.8% as a result of healthy top-line growth, helped by strong synergy capture,
      and partly offset by CoS pressure, as anticipated. EBITDA margins expanded by 238 bps to 37.7%. In
      HY17, EBITDA grew by 9.0% and EBITDA margin expanded by 161 bps to 37.5%.
      Net finance results: Net finance costs (excluding non-recurring net finance costs) grew from 726 million
      USD in 2Q16 to 1 628 million USD in 2Q17 predominantly due to a mark-to-market loss of 265 million USD
      in 2Q17, linked to the hedging of our share-based payment programs, compared to a gain of 444 million
      USD in 2Q16, resulting in a swing of 709 million USD. Net finance costs were
      3 120 million USD in HY17 compared to 1 945 million USD in HY16.




ab-inbev.com                                                                                                                                           1
      Income taxes: Income tax expense in 2Q17 was 575 million USD with a normalized effective tax rate
      (ETR) of 21.3%, compared to an income tax expense of 497 million USD in 2Q16 and a normalized ETR
      of 20.5%. The normalized ETR was 20.9% in HY17 compared to 21.5% in HY16.
      Profit: Normalized profit attributable to equity holders of AB InBev increased from 1 727 million USD in
      2Q16 to 1 872 million USD in 2Q17, with organic EBITDA growth partially offset by higher net finance costs.
      Normalized profit attributable to equity holders of AB InBev increased from 2 571 million USD in HY16 to 3
      331 million USD in HY17.
      Earnings per share: Normalized earnings per share (EPS) decreased from 1.06 USD in 2Q16 to 0.95
      USD in 2Q17, with higher profits more than offset by a negative impact of mark-to-market adjustments
      linked to the hedging of our share-based programs and the increased number of outstanding shares.
      Normalized EPS increased from 1.57 USD in HY16 to 1.69 USD in HY17.
      Combination with SAB: The business integration is progressing well, with synergies and cost savings of
      335 million USD captured during 2Q17.
      2017 Half Year Financial Report: The report is available on our website at www.ab-inbev.com.
      Figure 1. Consolidated performance (million USD)
                                                                                    2Q16              2Q16      2Q17    Organic
                                                                                Reported    Reference Base              growth
      Total Volumes (thousand hls)                                               114 908           150 652    157 679      1.0%
                                                          AB InBev own beer      104 999           128 313    130 483      2.1%
                                                           Non-beer volumes         9 044           21 504     25 889     -5.7%
                                                         Third party products         866               835     1 306      5.4%
      Revenue                                                                     10 806            13 453     14 182      5.0%
      Gross profit                                                                  6 582             8 192     8 738      6.1%
      Gross margin                                                                 60.9%             60.9%     61.6%     66 bps
      Normalized EBITDA                                                             4 011             4 856     5 354    11.8%
      Normalized EBITDA margin                                                     37.1%             36.1%     37.8%    238 bps
      Normalized EBIT                                                               3 222             3 862     4 338    15.0%
      Normalized EBIT margin                                                       29.8%             28.7%     30.6%    275 bps

      Profit attributable to equity holders of AB InBev                              152                        1 502
      Normalized profit attributable to equity holders of AB InBev                 1 727                        1 872

      Earnings per share (USD)                                                       0.09                        0.76
      Normalized earnings per share (USD)                                            1.06                        0.95


                                                                                    HY16              HY16      HY17    Organic
                                                                                Reported    Reference Base              growth
      Total Volumes (thousand hls)                                               219 776           293 497    305 550      0.3%
                                                          AB InBev own beer      198 880           246 109    248 212      1.0%
                                                           Non-beer volumes       19 303            45 858     55 132     -4.1%
                                                         Third party products       1 594             1 530     2 206    14.0%
      Revenue                                                                     20 206            25 526     27 104      4.4%
      Gross profit                                                                12 204            15 462     16 430      4.4%
      Gross margin                                                                 60.4%             60.6%     60.6%       4 bps
      Normalized EBITDA                                                             7 474             9 346    10 162      9.0%
      Normalized EBITDA margin                                                     37.0%             36.6%     37.5%    161 bps
      Normalized EBIT                                                               5 915             7 379     8 059    10.5%
      Normalized EBIT margin                                                       29.3%             28.9%     29.7%    169 bps

      Profit attributable to equity holders of AB InBev                              285                        2 908
      Normalized profit attributable to equity holders of AB InBev                 2 571                        3 331

      Earnings per share (USD)                                                       0.17                        1.48
      Normalized earnings per share (USD)                                            1.57                        1.69




ab-inbev.com                                                                                                                  2
      Figure 2. Volumes (thousand hls)
                                                       2Q16    Scope      Organic       2Q17    Organic growth
                                                  Reference               growth                   Total         Own beer
                                                       Base                                      Volume            volume
      North America                                  31 526       105        - 310     31 320     -1.0%             -0.6%
      Latin America West                             26 862       - 39         833     27 657      3.1%              3.8%
      Latin America North                            27 209       - 32      -1 046     26 131     -3.8%              0.2%
      Latin America South                             5 999          -         731      6 730     12.2%             14.7%
      EMEA                                           29 754     5 720        1 232     36 706      4.1%              6.0%
      Asia Pacific                                   28 900           6        - 21    28 885     -0.1%             -0.1%
      Global Export and Holding Companies               400     - 201            51       250     25.8%             25.8%
      AB InBev Worldwide                            150 652     5 557        1 470    157 679      1.0%              2.1%


                                                       HY16    Scope      Organic       HY17    Organic growth
                                                  Reference               growth                   Total         Own beer
                                                       Base                                      Volume            volume
      North America                                  58 439       211       -1 494     57 156     -2.6%             -2.7%
      Latin America West                             52 534       - 50         704     53 188      1.3%              1.3%
      Latin America North                            56 922         -5       - 367     56 550     -0.6%              2.1%
      Latin America South                            14 819          -       1 000     15 819      6.8%             10.3%
      EMEA                                           57 719    11 441          466     69 625      0.8%              2.6%
      Asia Pacific                                   52 162       - 20         426     52 568      0.8%              0.8%
      Global Export and Holding Companies               902     - 337           80        644     14.1%             14.1%
      AB InBev Worldwide                            293 497    11 239          814    305 550      0.3%              1.0%




       MANAGEMENT COMMENTS
      Our growth accelerated in the second quarter. Revenue grew by 5.0%, driven by revenue management
      and premiumization in markets such as Western Europe and China as well as volume growth. Our
      continued focus on driving premiumization allows us to generate top-line growth in emerging as well as
      developed markets. Our global brands continued to deliver strong revenue growth with revenue up by 8.9%
      this quarter. Corona led the way, with global growth of 16.6% and 26.2% growth outside of Mexico.

      We delivered volume growth of 1.0%, with own beer volumes up 2.1%. This result was achieved through
      double-digit beer volume growth in South Africa, as well as strong performances in Mexico and Argentina.

      Our EBITDA grew by 11.8% in 2Q17 and 9.0% in HY17. This growth is attributable to a healthy top-line
      growth, helped by strong synergy capture, although partly offset by the anticipated CoS pressure. Excluding
      Brazil, our revenue in the quarter grew by 6.2% with own beer volumes up by 2.6% and EBITDA growth of
      16.5%.

      The integration with SAB continues to go as planned, with additional synergy capture this quarter of 335
      million USD coming primarily from all of our new markets. We are also well underway sharing best practices,
      with intellectual synergies driving a new approach to category growth.

      2017 has been off to a good start and we will continue to push ourselves to deliver good results throughout
      the balance of the year. While the second half of the year looks promising, our focus remains on growing
      the global beer category as well as generating top-line growth in a sustainable way to position ourselves
      for long term success.


      2017 OUTLOOK

      (i)     Top-line: While recognizing the increased volatility in some of our key markets, we expect to
              accelerate total revenue growth in FY17, driven by the solid growth of our global brands and strong
              commercial plans, including revenue management initiatives.



ab-inbev.com                                                                                                            3
      (ii)    Cost of Sales: We expect CoS per hl to increase by low single digits on a constant geographic basis,
              despite unfavorable foreign exchange transactional impacts, and growth in our premium brands.
      (iii)   Selling, General and Administrative Expenses: We expect SG&A to remain broadly flat, as we will
              continue to find savings in overhead to invest behind our brands.
      (iv)    Synergies: We updated our 2.45 billion USD synergy and cost savings expectation to 2.8 billion USD
              during our FY16 results announcement, with synergies being calculated on a constant currency basis
              as of August 2016.
      (v)     Net Finance Costs: We expect the average rate of interest on net debt in FY17 to be in the range of
              3.5% to 4.0%. Net pension interest expenses and accretion expenses are expected to be
              approximately 30 and 150 million USD per quarter, respectively. Other financial results will continue
              to be impacted by any gains and losses related to the hedging of our share-based payment programs.
      (vi)    Effective Tax Rate: We are amending our FY17 guidance from the range of 24% to 26% to the range
              of 22% to 24%, excluding any future gains and losses relating to the hedging of our share based
              programs This guidance continues to include the impact of the change in country mix following the
              combination with SAB and the expected tax consequences of the funding of the combination.
      (vii)   Net Capital Expenditure: We expect net capital expenditure of approximately 3.7 billion USD in
              FY17.
      (viii) Debt: Approximately one third of AB InBev’s gross debt is denominated in currencies other than the
             US dollar, principally the Euro. Our optimal capital structure remains a net debt to EBITDA ratio of
             around 2x.
      (ix)    Dividends: We continue to expect dividends to be a growing flow over time, although growth is
              expected to be modest given the importance of deleveraging.


      BUSINESS REVIEW
      United States

      Our US business continued to deliver EBITDA growth in the first half of this year on the heels of a good
      2016 financial performance. This quarter we continued to see a strong performance from our Above
      Premium brands, which helped offset the challenges we are facing with our Premium brands.

      Revenue for the quarter decreased by 0.2% in 2Q17 and by 1.3% for HY17. Revenue per hl grew by 0.9%
      in 2Q17, negatively impacted by brand shipment mix, and by 1.5% in HY17. Our pricing strategy remains
      to target pricing in line with inflation.

      We estimate that industry STRs in the United States declined by 0.7% in 2Q17 and by 1.1% in HY17, in
      line with 2016 industry performance. Our own STRs were down 3.0% in both the quarter and HY17, with
      STWs down 1.1% in the quarter and down 2.7% in the half year. STRs and STWs have therefore converged
      during the first half, with stock levels well-placed to meet summer demand.

      We estimate a decline in total market share of approximately 105 bps in 2Q17, as we cycled a strong
      comparable versus 2Q16. We estimate a decline of 85 bps in HY17. We are not pleased with our market
      share performance and we will continue to work to balance the share and profitability equation while fine-
      tuning our regional pack-price strategy and leveraging our strong wholesaler system.

      Our Above Premium brand portfolio continued to perform well, gaining approximately 35 bps of total market
      share in the quarter (30 bps in HY17). Michelob Ultra was the top share gainer in the US for the ninth



ab-inbev.com                                                                                                     4
      consecutive quarter and continues to grow volumes by double-digits as a result of its consistent “Active
      Lifestyle” positioning and increased support behind the brand. Stella Artois had another strong quarter, and
      was the fastest growing European imported beer according to IRI. Our craft portfolio also continued to gain
      share.

      Our Value brands continued to show improved trends within the quarter, especially within the Busch brand
      family. These brands continue to retain a loyal consumer base while requiring minimal investment.

      The US Premium segment remains under pressure, as consumers continue to trade-up to high end brands.
      This is resulting in positive trends for many brands across our portfolio, but is putting pressure on Budweiser
      and Bud Light, which lost 40 bps and 90 bps of share in 2Q17, respectively.

      Overall, we are seeing positive momentum behind our Budweiser “America” campaign and encouraging
      signs from the new “Friendship” platform for Bud Light. These results present an opportunity for positive
      brand health moving forward, which better positions us for success in the long term. We’ve also taken the
      Budweiser “America” campaign to the State level, launching specific packaging to celebrate the locations
      of our 12 main breweries. Additionally, for Bud Light, we have developed local programming for key
      Hispanic markets as we bring the Friendship platform to life for more Americans.

      Despite soft volumes, disciplined cost management generated 3.9% organic EBITDA growth for the quarter
      with EBITDA margin up 168 bps to 42.2%. We continue to expand our gross profit margin, which grew by
      45 bps to 62.2% in 2Q17. In HY17, organic EBITDA grew 1.4% with EBITDA margin up 110 bps to 41.3%.


      Mexico

      Our business in Mexico continued to perform well in the quarter, with revenue increasing by low
      double-digits and volumes up mid-single digits, helped in part by the later Easter timing. In HY17, revenue
      grew by high single digits with volumes up by mid-single digits.

      Volume growth was led by Victoria, which grew by double-digits this quarter, as its Mexican heritage
      platform continues to drive brand health and sales. Corona volumes were up low single digits with brand
      health metrics continuing to trend positively. The American portfolio also performed well, with high double-
      digit growth in Bud Light and Michelob Ultra, while our global brands Budweiser and Stella Artois also
      recorded high double-digit growth.

      EBITDA grew by 4.6% in Mexico in 2Q17, with margin compression of 242 bps to 43.2%. Top-line growth
      was partially offset by the combined impacts of currency devaluation on our CoS as well as an energy price
      increase at the beginning of the year. The level of sales and marketing investment in the second quarter
      was atypical, and for this reason we believe the HY17 EBITDA result is more representative of our business
      performance. In HY17, EBTIDA grew by 9.9% with margin expansion of 30 bps to 42.7%.


      Colombia

      In the quarter our Colombian revenues grew by 3.1%, driven by mid-single digit increases in revenue per
      hl, partly offset by a 1.4% decline in volumes. Beer volumes, which cycled an unusually dry first half in the
      previous year due to effects from El Niño, remained soft reflecting muted consumer confidence and lower
      disposable income following the country wide VAT increase at the beginning of the year. In HY17, our total
      revenue was down 0.8% with volume down by 4.6%. We continue rolling out our high end strategy to drive
      further growth of our global brands, which were up approximately 100% this quarter.




ab-inbev.com                                                                                                       5
      Our EBITDA in Colombia grew by 19.4% in 2Q17, with margin expansion of 715 bps. This was a result of
      synergy capture, cost discipline and the growth of our premium brand portfolio. In HY17, EBITDA increased
      by 4.6% with margin expansion of 260 bps.


      Brazil

      Total revenue declined by 3.8% in 2Q17 and by 1.6% in HY17, with revenue per hl improving by 0.9% in
      the quarter but declining by 0.7% in HY17.

      Our beer volumes in Brazil decreased by 1.3% in the quarter. We again outperformed the total industry,
      which declined by 2.7% and which continues to be affected by turbulent political and macroeconomic
      environments, driving high unemployment rates and low consumer confidence. Beer revenue benefited
      from strong growth of our global brands, but this was more than offset by the negative pack mix due to the
      growth of returnable glass bottles, which have a negative impact on revenue per hl but are accretive for
      both EBITDA and margin.

      In our non-beer business, revenue per hl increased by 6.6% driven by revenue management initiatives
      implemented in the quarter. Volume declines of 14.1% underperformed the industry in the quarter, but the
      decline of 6.8% in HY17 outperformed an industry which has been hit hard by pressure on disposable
      income and discretionary spending.

      The Brazilian economy is recovering at a slow pace, still representing a challenge for the beer industry in
      the short term. We acknowledge the difficult reality, but we believe in our strategy, remaining cautiously
      optimistic for the year. Further, as we will now begin cycling more favorable net revenue per hl comparables,
      and CoS per hl will bridge to between a flattish and low single-digit increase, we expect to resume EBITDA
      growth in the second half of 2017. With that in mind, we will continue to put efforts in our plan, focusing on
      our commercial platforms in Brazil and pursuing cost savings and efficiency gains to positively impact our
      profitability.

      EBITDA declined by 15.4% in 2Q17, with margin contraction of 535 bps to 39.2%. This result was driven
      by the revenue decline and by the anticipated double-digit increase in CoS per hl due to the impact of
      devaluation on transactional currency. In HY17, our EBITDA declined by 19.7% with margin contraction of
      877 bps to 39.0%.


      South Africa

      Our beer revenues in South Africa grew by 13.4% in 2Q17 driven by revenue per hl growth of 2.4% and
      beer volume growth of 10.8% benefiting from the timing of Easter. In HY17, revenue grew 9.7% with
      revenue per hl growth of 5.1% and beer volume growth of 4.4%.

      This solid top-line growth was driven by a portfolio of brands with distinctive positioning and consistent
      through-the-line sales execution. The newly launched high end unit recorded promising growth in Stella
      Artois and Corona. Castle Lite continues its multi-year trend of strong growth in the core plus segment,
      while Carling Black Label has responded well to core plus pricing and consistent “champion” positioning
      with impactful multi-media soccer activation. Lion Lager’s return to the portfolio in the value segment is
      making good progress at winning back share from inexpensive wines and spirits. In near beer, Flying Fish,
      an apple-flavored malt beverage, has performed very well during the quarter and has helped to win back
      category market share previously lost to ciders.




ab-inbev.com                                                                                                      6
      When combined with the soft drink business, the South African business delivered 8.8% revenue growth in
      2Q17 and 6.1% in HY17. This strong top-line growth combined with synergy capture resulted in EBITDA
      growth of almost 30% in 2Q17 and almost 20% in HY17.


      China

      Our business in China maintained its strong momentum this quarter, with revenue up 7.2% driven by
      revenue management initiatives and 1.0% volume growth. In HY17, revenue grew 9.1% with revenue per
      hl up 6.2% and volume growth of 2.7%.

      Budweiser continues to perform well with volumes up double-digits in the quarter. Building on solid
      commercial execution during the Chinese New Year in 1Q17, Budweiser is now establishing itself with a
      more balanced channel mix underpinned by strong growth in Chinese restaurants and in-home occasions.
      The super premium brands - Corona, Stella Artois and Hoegaarden - all continue to exhibit strong growth
      driven by female consumers who respond to the brands’ focus on heritage, uniqueness and serving rituals.
      Innovations have also assisted the growth, with Harbin Baipi, a recently launched wheat beer,
      demonstrating wide appeal with rapid sales growth. Harbin Ice is also showing solid growth in the core plus
      segment.

      EBITDA grew by 20.9% in China in 2Q17, with margin expansion of over 400 bps to 35.7%. This is a result
      of strong top-line growth combined with savings in CoS and SG&A. In HY17, EBITDA was up 28.6% with
      margin expansion of over 500 bps to 34.7%.


      Highlights from our other markets

      Canada continues to perform well, as market share gains and net revenue per hl growth overcame a soft
      beer industry to drive top-line growth in the quarter. Bud Light continues to gain momentum and we are
      seeing strength in the high end of the market, with both our craft portfolio and Stella Artois gaining share.

      Peru delivered strong revenue growth of 10.0% with volume up 4.1% as a result of our commercial efforts
      within the quarter. Ecuador also recorded revenue and volume gains of 8.9% and 6.4% respectively in the
      quarter as a result of an enhanced commercial strategy as well as cycling a favorable comparable after the
      earthquake in April 2016.

      Argentina delivered over 20% growth in beer volumes, with enhanced commercial strategies delivering
      good results for both our core and premium portfolios and allowing us to gain market share in beer and total
      alcohol. Our soft drinks business also recorded volume growth in the high single digits.

      Within EMEA, Western Europe had another great quarter and double-digit revenue growth, driven by
      strong performance of our premium portfolio, especially our global brands. The UK performed particularly
      well with double-digit top-line growth resulting from a strong commercial performance. In Eastern Europe,
      revenues declined by low single digits as volumes declined by high single digits. We continue to face a
      difficult macroeconomic environment in both Russia and Ukraine as well as a large PET ban in Russia,
      although we did see good growth from our premium portfolio in these markets. In Africa, excluding South
      Africa, beer volumes grew by over 20%, fueled by strong growth in Nigeria, Tanzania, and Uganda. We
      also saw high single digit beer volume growth in Zambia, and marginal growth in Mozambique.

      Australia had another strong quarter, with high single digit growth in revenue and mid-single digit growth
      in volumes. The strong top-line growth, and resulting market share gains, were driven by continued success
      of the Great Northern portfolio, which is Australia’s fastest growing beer, as well as the accelerated growth




ab-inbev.com                                                                                                     7
      of the global brand portfolio. Additionally, good synergy capture supported double-digit EBITDA growth and
      substantial margin expansion.




ab-inbev.com                                                                                                  8
       CONSOLIDATED INCOME STATEMENT

      Figure 3. Consolidated income statement (million USD)
                                                                 2Q16               2Q16    2Q17       Organic
                                                              Reported    Reference Base               growth
      Revenue                                                   10 806            13 453   14 182         5.0%
      Cost of sales                                             -4 225            -5 262   -5 444        -3.2%
      Gross profit                                               6 582             8 192    8 738         6.1%
      SG&A                                                      -3 619            -4 614   -4 551         3.8%
      Other operating income/(expenses)                            259               284      151       -40.1%
      Normalized profit from operations
      (normalized EBIT)                                          3 222             3 862     4 338      15.0%
      Non-recurring items above EBIT                              -106                         -66
      Net finance income/(cost)                                  - 726                      -1 628
      Non-recurring net finance income/(cost)                   -1 484                       - 310
      Share of results of associates                                 1                          70
      Income tax expense                                         - 497                       - 575
      Profit from continuing operations                            410                       1 829
      Discontinued operations results                                -                           -
      Profit                                                       410                       1 829
      Profit attributable to non-controlling interest              257                         327
      Profit attributable to equity holders of AB InBev            152                       1 502

      Normalized EBITDA                                          4 011             4 856    5 354       11.8%
      Normalized profit attributable to equity
      holders of AB InBev                                        1 727                      1 872


                                                                 HY16               HY16    HY17       Organic
                                                              Reported    Reference Base               growth
      Revenue                                                   20 206            25 526    27 104        4.4%
      Cost of sales                                             -8 002           -10 065   -10 674       -4.3%
      Gross profit                                              12 204            15 462    16 430        4.4%
      SG&A                                                      -6 711            -8 575    -8 779        1.2%
      Other operating income/(expenses)                            422               492       408       -7.3%
      Normalized profit from operations
      (normalized EBIT)                                          5 915             7 379     8 059      10.5%
      Non-recurring items above EBIT                             - 139                       - 287
      Net finance income/(cost)                                 -1 945                      -3 120
      Non-recurring net finance income/(cost)                   -2 168                       - 211
      Share of results of associates                                  3                        124
      Income tax expense                                         - 835                       - 994
      Profit from continuing operations                            829                       3 572
      Discontinued operations results                                -                          28
      Profit                                                       829                       3 600
      Profit attributable to non-controlling interest              544                         692
      Profit attributable to equity holders of AB InBev            285                       2 908

      Normalized EBITDA                                          7 474             9 346   10 162        9.0%
      Normalized profit attributable to equity
      holders of AB InBev                                        2 571                      3 331




      Revenue
      Consolidated revenue grew by 5.0% in 2Q17, with revenue per hl growth of 3.2%, driven by our revenue
      management and premiumization initiatives. On a constant geographic basis revenue per hl grew by 3.6%.
      In HY17, revenue grew by 4.4%, with revenue per hl growth of 4.2% on an organic basis and 4.1% on a
      constant geographic basis.

      Cost of Sales (CoS)
      Total CoS increased by 3.2%, and by 1.3% on a per hl basis in 2Q17. This increase was driven primarily
      by anticipated transactional foreign exchange and commodity impacts, offset by synergy capture,
      procurement savings and supply efficiencies. On a constant geographic basis, CoS per hl increased by
      2.2%. In HY17, total CoS increased by 4.3%, by 4.2% on a per hl basis, and by 4.3% per hl on a constant
      geographic basis.


ab-inbev.com                                                                                                9
      Selling General and Administrative Costs (SG&A)
      SG&A declined by 3.8%, reflecting good synergy capture combined with overall strong ZBB discipline. In
      HY17, SG&A declined by 1.2%.

      Other operating income
      Other operating income decreased organically by 40.1% to 151 million USD in 2Q17 as government grants
      received in the previous year in China and Brazil were not repeated. Other operating income decreased by
      7.3% to 408 million USD in HY17.

      Non-recurring items above EBIT
      Figure 4. Non-recurring items above EBIT (million USD)
                                                                                     2Q16      2Q17      HY16      HY17
      Restructuring                                                                    - 43     - 99       - 62    - 288
      Acquisition costs / Business combinations                                        - 60       -8       - 79      - 25
      Business and asset disposal (including impairment losses)                          -2       41          2        26
      Impact on profit from operations                                               - 105      - 66     - 139     - 287



      Normalized profit from operations excludes negative non-recurring items of 66 million USD in 2Q17,
      primarily related to the one-off restructuring costs related to the SAB integration.

      Figure 5. Net finance income/(cost) (million USD)
                                                                                     2Q16      2Q17      HY16      HY17
      Net interest expense                                                           - 866     - 973    -1 547    -2 057
      Net interest on net defined benefit liabilities                                  - 30      - 26      - 59      - 55
      Accretion expense                                                              - 120     - 134     - 263     - 303
      Other financial results                                                          290     - 495       - 76    - 705
      Net finance income/(cost)                                                      - 726    -1 628    -1 945    -3 120




      Net finance costs (excluding non-recurring net finance costs) were 1 628 million USD in 2Q17 compared
      to 726 million USD in 2Q16. Net interest expense increased from 866 million USD to 973 million USD. Other
      financial results include a mark-to-market loss of 265 million USD in 2Q17, linked to the hedging of our
      share-based payment programs, compared to a gain of 444 million USD in 2Q16, resulting in a swing of
      709 million USD.

      Net finance costs in HY17 were 3 120 million USD compared to 1 945 million USD in HY16. This increase
      in net finance costs was driven primarily by additional debt related to the SAB combination and interest
      expenses on the legacy SAB debt. Other finance results in HY17 includes a negative
      mark-to-market adjustment of 135 million USD, linked to the hedging of our share-based payment
      programs, compared to a gain of 306 million USD in HY16.

      The number of shares covered by the hedging of our share-based payment programs, and the opening and
      closing share prices, are shown in figure 6 below.

      Figure 6. Share-based payment hedge
                                                                                     2Q16      2Q17      HY16      HY17
      Share price at the start of the period (Euro)                                 109.25    102.90    114.40    100.55
      Share price at the end of the period (Euro)                                   117.60     96.71    117.60     96.71
      Number of equity derivative instruments at the end of the period (millions)     44.2      47.1      44.2      47.1




      Non-recurring net finance income/(cost)
      Non-recurring net finance costs were 310 million USD in 2Q17 compared to a cost of 1 484 million USD
      in 2Q16. Non-recurring net finance costs in 2Q16 included a negative mark-to-market adjustment of
      1 766 million USD, related to the portion of the FX hedging of the purchase price of the combination with
      SAB that did not qualify for hedge accounting under IFRS rules.



ab-inbev.com                                                                                                         10
      The 2Q17 result includes a negative mark-to-market adjustment on our non-recurring equity derivative
      instruments relating to the issue of deferred shares in the Grupo Modelo combination and the issue of
      restricted shares in the SAB combination. The number of shares covered by the hedging of the deferred
      share instrument and the restricted shares are shown in figure 8, together with the opening and closing
      share prices.
      Figure 7. Non-recurring net finance income/(cost) (million USD)
                                                                                                           2Q16     2Q17      HY16     HY17


      Mark-to-market (Grupo Modelo deferred share instrument)                                               230     - 125      146      - 71
      Mark-to-market (Portion of the FX hedging of the purchase price of the combination with
                                                                                                          -1 766        -    -2 365         -
      SABMiller that did not qualify for hedge accounting)
      Other mark-to-market                                                                                   168    - 114       293      - 69
      Other                                                                                                - 116      - 71    - 242      - 71
      Non-recurring net finance income/(cost)                                                             -1 484    - 310    -2 168    - 211


      Figure 8. Non-recurring equity derivative instruments
                                                                                                           2Q16     2Q17      HY16     HY17
      Share price at the start of the period (Euro)                                                       109.25   102.90    114.40   100.55
      Share price at the end of the period (Euro)                                                         117.60    96.71    117.60    96.71
      Number of equity derivative instruments at the end of the period (millions)                           38.1     45.3      38.1     45.3




      Figure 9. Income tax expense (million USD)
                                                                                                           2Q16     2Q17      HY16     HY17
      Income tax expense                                                                                    497      575       835      994
      Effective tax rate                                                                                  54.9%    24.7%     50.2%    22.4%
      Normalized effective tax rate                                                                       20.5%    21.3%     21.5%    20.9%



      Figure 10. Normalized Profit attribution to equity holders of AB InBev (million USD)
                                                                                                           2Q16     2Q17      HY16     HY17

      Profit attributable to equity holders of AB InBev                                                     152     1 502      285     2 908

      Non-recurring items, after taxes, attributable to equity holders of AB InBev                           90        61      119       240

      Non-recurring finance (income)/cost, after taxes, attributable to equity holders of AB InBev         1 484      309     2 167      211
      Discontinued operations results                                                                          -        -         -      - 28
      Normalized profit attributable to equity holders of AB InBev                                         1 727    1 872     2 571    3 331




      Normalized and Basic EPS

      Figure 11. Earnings per share (USD)
                                                                                                           2Q16     2Q17      HY16     HY17
      Basic earnings per share                                                                              0.09     0.76      0.17     1.48

      Non-recurring items, after taxes, attributable to equity holder of AB InBev, per share                0.06     0.03      0.07     0.11
      Non-recurring finance (income)/cost, after taxes, attributable to equity holders of AB InBev, per
      share                                                                                                 0.90     0.16      1.32     0.11
      Discontinued operations results, per share                                                               -        -         -    -0.01
      Normalized earnings per share                                                                         1.06     0.95      1.57     1.69


      Normalized earnings per share (EPS) decreased from 1.06 USD in 2Q16 to 0.95 USD in 2Q17, with the
      organic increase in EBITDA more than offset by the negative impact of mark-to-market adjustments linked
      to the hedging of our share-based programs and the impact of a higher number of shares.




ab-inbev.com                                                                                                                             11
      Figure 12. Key components - Normalized Earnings per share in USD
                                                                                                                               2Q16     2Q17        HY16     HY17
      Normalized EBIT                                                                                                           1.96     2.64        3.60     4.91
      Mark-to-market (Hedging of our share-based payment programs)                                                               0.27   -0.16       0.19     -0.08
      Pre-funding of SAB transaction                                                                                            -0.26       -       -0.46        -
      Net finance cost                                                                                                          -0.46   -0.83       -0.92    -1.82
      Income tax expense                                                                                                        -0.31   -0.35       -0.52    -0.63
      Associates & non-controlling interest                                                                                     -0.14   -0.16       -0.32    -0.35
      Share dilution                                                                                                                -   -0.19           -    -0.34
      Normalized EPS                                                                                                             1.06    0.95        1.57     1.69

      Note: HY16 and HY17 before dilution calculated based upon weighted average number of shares per HY16 of 1 641 million shares.
      EPS after dilution based upon weighted average number of shares per HY17 of 1 970 million shares.




      Reconciliation between profit attributable to equity holders and normalized EBITDA

      Figure 13. Reconciliation of normalized EBITDA to profit attributable to equity holders of AB InBev (million USD)
                                                                                              2Q16           2Q17                                  HY16      HY17
                                                                                          Reported                                              Reported
      Profit attributable to equity holders of AB InBev                                         152         1 502                                    285     2 908
      Non-controlling interests                                                                 257             327                                  544       692
      Profit                                                                                    410         1 829                                    829     3 600
      Discontinued operations results                                                             -               -                                    -       - 28
      Profit from continuing operations                                                         410         1 829                                    829     3 572
      Income tax expense                                                                        497             575                                  835       994
      Share of result of associates                                                              -1            - 70                                   -3     - 124
      Net finance (income)/cost                                                                 726         1 628                                  1 945     3 120
      Non-recurring net finance (income)/cost                                                 1 484             310                                2 168       211
      Non-recurring items above EBIT (incl. non-recurring impairment)                           106              66                                  139       287
      Normalized EBIT                                                                         3 222         4 338                                  5 915     8 059
      Depreciation, amortization and impairment                                                 789         1 016                                  1 559     2 103
      Normalized EBITDA                                                                       4 011         5 354                                  7 474    10 162



      Normalized EBITDA and normalized EBIT are measures utilized by AB InBev to demonstrate the
      company’s underlying performance.

      Normalized EBITDA is calculated excluding the following effects from profit attributable to equity holders of
      AB InBev: (i) non-controlling interest; (ii) discontinued operations results; (iii) income tax expense; (iv) share
      of results of associates; (v) net finance cost; (vi) non-recurring net finance cost; (vii) non-recurring items
      above EBIT (including non-recurring impairment); and (viii) depreciation, amortization and impairment.

      Normalized EBITDA and normalized EBIT are not accounting measures under IFRS accounting and should
      not be considered as an alternative to profit attributable to equity holders as a measure of operational
      performance, or an alternative to cash flow as a measure of liquidity. Normalized EBITDA and normalized
      EBIT do not have a standard calculation method and AB InBev’s definition of normalized EBITDA and
      normalized EBIT may not be comparable to that of other companies.




ab-inbev.com                                                                                                                                                   12
       FINANCIAL POSITION


      Figure 14. Cash Flow Statement (million USD)
                                                                                                HY16          HY17
      Operating activities
      Profit                                                                                      829         3 600
      Interest, taxes and non-cash items included in profit                                     6 564         6 379
      Cash flow from operating activities before changes in working capital
      and use of provisions                                                                     7 393         9 979

      Change in working capital                                                                -1 673        -2 352
      Pension contributions and use of provisions                                               - 265         - 288
      Interest and taxes (paid)/received                                                       -3 008        -3 381
      Dividends received                                                                            6            60
      Cash flow from operating activities                                                       2 453         4 018

      Investing activities
      Net capex                                                                                -1 419        -1 579
      Acquisition and sale of subsidiaries, net of cash acquired/disposed of                   -1 035         - 448
      Proceeds from the sale/(acquisition) of investment in short-term debt securities        -55 905         2 788
      Net of tax proceeds from the sale of assets held for sale                                    58         5 134
      Other                                                                                         2           219
      Cash flow from investing activities                                                     -58 299         6 114

      Financing activities
      Dividends paid                                                                          -3 929         -4 475
      Net (payments on)/proceeds from borrowings                                              58 801         -5 239
      Other (including net finance cost other than interest)                                      75          - 361
      Cash flow from financing activities                                                     54 947        -10 075

      Net increase/(decrease) in cash and cash equivalents                                      - 899            57


      HY17 recorded an increase in cash and cash equivalents of 57 million USD compared to a decrease of 899
      million USD in HY16, with the following movements:

          Our cash flow from operating activities reached 4 018 million USD in the first half of 2017 compared to
          2 453 million USD in the first half of 2016. The year-over-year change is mainly explained by increased
          profit following the SAB combination.
          Net cash inflow from investing activities was 6 114 million USD in the first half of 2017 as compared to
          a net cash used of 58 299 million USD in the first half of 2016. 2017 cash flow from investing activities
          mainly reflects the proceeds from the announced divestitures completed during 2017, net of taxes paid
          in 2017 on prior year divestitures. During the first half of 2016, we issued a series of bonds in order to
          support the combination with SAB. The 2016 cash flow from investing activities reflects the investment
          of the excess liquidity resulting from these bonds, mainly in US Treasury Bills, pending the closing of
          the combination. Our net capital expenditures amounted to 1 579 million USD in the first half of 2017
          and 1 419 million USD in the first half of 2016. Out of the total HY17 capital expenditures approximately
          49% was used to improve the company’s production facilities while 36% was used for logistics and




ab-inbev.com                                                                                                     13
          commercial investments and 15% was used for improving administrative capabilities and purchase of
          hardware and software.
          The cash outflow from our financing activities amounted to 10 075 million USD in the first half of 2017,
          as compared to a cash inflow of 54 947 million USD in the first half of 2016. During the first half of 2017,
          we repaid 8 billion USD outstanding under the Term Loan B. This Term Loan was the last remaining
          facility of the 75 billion USD senior facilities raised in October 2015 to finance the combination with
          SAB. The cash inflow from financing activities in the six-month period ended 30 June 2016 reflected
          the pre-funding of the combination with SAB.

      Our net debt as of 30 June 2017 was 109.1 billion USD, an increase from 108.0 billion USD as of 31
      December 2016. The net debt to normalized EBITDA ratio decreased from 5.5x as of 31 December 2016
      to 5.3x as of 30 June 2017, both on an amended basis incorporating the Reference Base EBITDA of the
      combined group for the periods prior to the combination with SAB. The net debt to EBITDA calculation
      excludes any EBITDA from the SAB Central and Eastern Europe businesses and the stake in Distell. The
      results of CCBA are included as of July 2016 and will continue to be reported throughout our ownership of
      the stake in CCBA.

                                 3Q16 Normalized EBITDA (Reference Base)               5 039 million USD
                                 4Q16 Normalized EBITDA                                5 248 million USD
                                 HY17 Normalized EBITDA                               10 157 million USD
                                 Last 12 Months Normalized EBITDA                     20 444 million USD

      As of 30 June 2017, we had total liquidity of 19.1 billion USD, which consisted of 9.0 billion USD available
      under committed long-term credit facilities and 10.1 billion USD of cash, cash equivalents and short-term
      investments in debt securities less bank overdrafts. Although we may borrow such amounts to meet our
      liquidity needs, we principally rely on cash flows from operating activities to fund our continuing operations.


      Figure 15. Terms and debt repayment schedule as of 30 June 2017 (billion USD)


      Figure 15. may be viewed on the company’s website – ab-inbev.com

ab-inbev.com                                                                                                       14
       NOTES
      To facilitate the understanding of AB InBev’s underlying performance, the analyses of growth, including all comments in this press
      release, unless otherwise indicated, are based on organic growth and normalized numbers. In other words, financials are analyzed
      eliminating the impact of changes in currencies on translation of foreign operations, and scope changes. Scope changes represent
      the impact of acquisitions and divestitures, the start or termination of activities or the transfer of activities between segments,
      curtailment gains and losses and year over year changes in accounting estimates and other assumptions that management does not
      consider as part of the underlying performance of the business.

      All references per hectoliter (per hl) exclude US non-beer activities. To eliminate the effect of geography mix, i.e. the impact of stronger
      volume growth coming from countries with lower revenue per hl, and lower Cost of Sales per hl, we are also presenting, where
      specified, organic growth per hectoliter figures on a constant geographic basis. When we make estimations on a constant geographic
      basis, we assume each country in which we operate accounts for the same percentage of our global volume as in the same period of
      the previous year.

      Whenever presented in this document, all performance measures (EBITDA, EBIT, profit, tax rate, EPS) are presented on a
      “normalized” basis, which means they are presented before non-recurring items and discontinued operations. Non-recurring items are
      either income or expenses which do not occur regularly as part of the normal activities of the Company. They are presented separately
      because they are important for the understanding of the underlying sustainable performance of the Company due to their size or
      nature. Normalized measures are additional measures used by management, and should not replace the measures determined in
      accordance with IFRS as an indicator of the Company’s performance. The results of the CEE business are presented as “discontinued
      operations result” until their disposal on 31 March 2017. Values in the figures and annexes may not add up, due to rounding.

      Given the transformational nature of the transaction with SAB that closed on 10 October 2016, and to facilitate the understanding of
      AB InBev’s underlying performance, AB InBev has updated its 1Q16 segment reporting for purposes of this results announcement
      and internal review by senior management. This presentation (referred to as the “Reference Base”) includes, for comparative
      purposes, the results of the SAB business as if the combination had taken place at the beginning of 4Q15, but excluding the results
      of (i) those business sold since the combination was completed, including the joint venture stakes in MillerCoors and CR Snow, and
      the sale of the Peroni, Grolsch and Meantime brands and associated businesses in Italy, the Netherlands, the UK and internationally
      and (ii) the Central and Eastern Europe business and the stake in Distell. The changes, effective 1 October 2016, include the former
      SAB geographies. Colombia, Peru, Ecuador, Honduras and El Salvador are reported together with Mexico as Latin America West,
      Panama is reported within Latin America North, Africa is reported together with Europe as EMEA, and Australia, India and Vietnam
      are reported within APAC.

      2Q17 and HY17 EPS is based upon a weighted average of 1,970 million shares compared to a weighted average of 1,641 million
      shares for 2Q16 and HY16.


      Legal Disclaimer
      This release contains “forward-looking statements”. These statements are based on the current expectations and views of future
      events and developments of the management of AB InBev and are naturally subject to uncertainty and changes in circumstances.
      The forward-looking statements contained in this release include, among other things, statements relating to AB InBev’s business
      combination with SAB and other statements other than historical facts. Forward-looking statements include statements typically
      containing words such as “will”, “may”, “should”, “believe”, “intends”, “expects”, “anticipates”, “targets”, “estimates”, “likely”, “foresees”
      and words of similar import. All statements other than statements of historical facts are forward-looking statements. You should not
      place undue reliance on these forward-looking statements, which reflect the current views of the management of AB InBev, are subject
      to numerous risks and uncertainties about AB InBev and are dependent on many factors, some of which are outside of AB InBev’s
      control. There are important factors, risks and uncertainties that could cause actual outcomes and results to be materially different,
      including the ability to realize synergies from the business combination with SAB, the risks and uncertainties relating to AB InBev
      described under Item 3.D of AB InBev’s Annual Report on Form 20-F (“Form 20-F”) filed with the US Securities and Exchange
      Commission (“SEC”) on 22 March 2017. Other unknown or unpredictable factors could cause actual results to differ materially from
      those in the forward-looking statements.

      The forward-looking statements should be read in conjunction with the other cautionary statements that are included elsewhere,
      including AB InBev’s most recent Form 20-F and other reports furnished on Form 6-K, and any other documents that AB InBev or
      SAB have made public. Any forward-looking statements made in this communication are qualified in their entirety by these cautionary
      statements and there can be no assurance that the actual results or developments anticipated by AB InBev will be realized or, even
      if substantially realized, that they will have the expected consequences to, or effects on, AB InBev or its business or operations. Except
      as required by law, AB InBev undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result
      of new information, future events or otherwise.

      The 2016 Reference Base information is based in part on certain assumptions that AB InBev believes are reasonable under the
      circumstances. The 2016 Reference Base information is presented for illustrative purposes only and does not necessarily reflect the
      results of operations or the financial position of the combined former AB InBev and SAB groups that would have resulted had the
      combination occurred on 8 October 2015, or project the results of operations or financial position of the combined group for any future
      date or period. The 2016 Reference Base information is not pro forma financial information, and has not been prepared in accordance



ab-inbev.com                                                                                                                                    15
      with Article 11 of Regulation S-X promulgated by the U.S. Securities and Exchange Commission. It is therefore not consistent in terms
      of content and presentation with pro forma financial information that has been or will be included in reports filed under Sections 13(a)
      or 15(d) of the U.S. Securities Exchange Act of 1934, as amended.



       NOTES

      The second quarter 2017 (2Q17) and half year (HY17) financial data set out in Figure 1 (except for the volume information), Figures
      3 to 5, 7, 9 to 11 and 13 of this press release have been extracted from the group’s unaudited condensed consolidated interim financial
      statements as of and for the six months ended 30 June 2017, which have been reviewed by our statutory auditors Deloitte
      Bedrijfsrevisoren BCVBA in accordance with International Standard on Review Engagements 2410, “Review of Interim Financial
      Information Performed by the Independent Auditor of the Entity” and the standards of the Public Company Accounting Oversight Board
      (United States). The auditors concluded that, based on their review, nothing had come to their attention that caused them to believe
      that those interim financial statements were not prepared fairly, in all material respects, in accordance with IAS 34 “Interim Financial
      Reporting”, as issued by the IASB and as adopted by the European Union. Financial data included in Figures 6, 8 and 12 have been
      extracted from the underlying accounting records as of and for the six months ended 30 June 2017 (except for the volume information).


       CONFERENCE CALL AND WEBCAST

      Investor Conference call and Webcast on Thursday, 27 July 2017:

      3.00pm Brussels / 2.00pm London / 9.00am New York

      Registration details

      Webcast (listen-only mode)
      http://bit.ly/webcastq2

      Conference call (with interactive Q&A)
      http://bit.ly/confcallq2




       ANHEUSER-BUSCH INBEV CONTACTS

      Media                                                                    Investors
      Marianne Amssoms                                                         Henry Rudd
      Tel: +1-212-573-9281                                                     Tel: +1-212-503-2890
      E-mail: marianne.amssoms@ab-inbev.com                                    E-mail: henry.rudd@ab-inbev.com


      Aimee Baxter                                                             Mariusz Jamka
      Tel: +1-718-650-4003                                                     Tel: +32-16-27-68-88
      E-mail: aimee.baxter@ab-inbev.com                                        E-mail: mariusz.jamka@ab-inbev.com

      Peter Dercon                                                             Lauren Abbott
      Tel: +32-16-27-68-23                                                     Tel: +1-212-573-9287
      E-mail: peter.dercon@ab-inbev.com                                        E-mail: lauren.abbott@ab-inbev.com

      About Anheuser-Busch InBev




ab-inbev.com                                                                                                                              16
      Anheuser-Busch InBev is a publicly traded company (Euronext: ABI) based in Leuven, Belgium, with secondary listings on the Mexico
      (MEXBOL: ANB) and South Africa (JSE: ANH) stock exchanges and with American Depositary Receipts on the New York Stock
      Exchange (NYSE: BUD). Our Dream is to bring people together for a better world. Beer, the original social network, has been bringing
      people together for thousands of years. We are committed to building great brands that stand the test of time and to brewing the best
      beers using the finest natural ingredients. Our diverse portfolio of well over 500 beer brands includes global brands Budweiser®,
      Corona® and Stella Artois®; multi-country brands Beck’s®, Castle®, Castle Lite®, Hoegaarden® and Leffe®; and local champions
      such as Aguila®, Antarctica®, Bud Light®, Brahma®, Cass®, Chernigivske®, Cristal®, Harbin®, Jupiler®, Klinskoye®, Michelob
      Ultra®, Modelo Especial®, Quilmes®, Victoria®, Sedrin®, Sibirskaya Korona® and Skol®. Our brewing heritage dates back more
      than 600 years, spanning continents and generations. From our European roots at the Den Hoorn brewery in Leuven, Belgium. To
      the pioneering spirit of the Anheuser & Co brewery in St. Louis, US. To the creation of the Castle Brewery in South Africa during the
      Johannesburg gold rush. To Bohemia, the first brewery in Brazil. Geographically diversified with a balanced exposure to developed
      and developing markets, we leverage the collective strengths of approximately 200,000 employees based in more than 50 countries
      worldwide. For 2016, AB InBev’s reported revenue was 45.5 billion USD (excluding JVs and associates).




ab-inbev.com                                                                                                                           17
      Annex 1
      AB InBev Worldwide                                       2Q16   Scope       Currency       Organic      2Q17    Organic
                                                     Reference Base             translation      growth               growth
      Total volumes (thousand hls)                          150 652   5 557                 -      1 470    157 679      1.0%
                        of which AB InBev own beer          128 313   - 465                 -      2 635    130 483      2.1%
      Revenue                                                13 453     100            -   25        654     14 182      5.0%
      Cost of sales                                          -5 262     - 26                 3     - 159     -5 444     -3.2%
      Gross profit                                            8 192       72           -   22        496      8 738      6.1%
      SG&A                                                   -4 614   - 114                  4       173     -4 551      3.8%
      Other operating income/(expenses)                         284     - 33                 1     - 101        151    -40.1%
      Normalized EBIT                                         3 862     - 76           -   16        568      4 338     15.0%
      Normalized EBITDA                                       4 856     - 54           -   13        566      5 354     11.8%
      Normalized EBITDA margin                               36.1%                                           37.7%    238 bps

      North America                                            2Q16   Scope       Currency       Organic      2Q17    Organic
                                                     Reference Base             translation      growth               growth
      Total volumes (thousand hls)                           31 526     105               -        - 310     31 320     -1.0%
      Revenue                                                 4 263       35           - 28             1     4 271         -
      Cost of sales                                          -1 544     - 25               7           11    -1 550      0.7%
      Gross profit                                            2 717       13           - 21            13     2 722      0.5%
      SG&A                                                   -1 208     - 14             12            55    -1 155      4.5%
      Other operating income/(expenses)                          20        -              -          - 15         5    -76.2%
      Normalized EBIT                                         1 529       -1             -9            52     1 571      3.4%
      Normalized EBITDA                                       1 732        -           - 10            55     1 778      3.2%
      Normalized EBITDA margin                               40.6%                                           41.6%    129 bps

      Latin America West                                       2Q16   Scope       Currency       Organic      2Q17    Organic
                                                     Reference Base             translation      growth               growth
      Total volumes (thousand hls)                           26 862     - 39              -         833      27 657      3.1%
      Revenue                                                 2 149        1           - 49         182       2 284      8.5%
      Cost of sales                                           - 623       -2             15         - 31      - 641     -4.9%
      Gross profit                                            1 527       -2           - 34         151       1 643      9.9%
      SG&A                                                    - 738     - 13             18            7      - 726      1.0%
      Other operating income/(expenses)                          40     - 32              -            2          9    19.1%
      Normalized EBIT                                           829     - 48           - 15         160         927    20.5%
      Normalized EBITDA                                         988     - 47           - 18         154       1 077    16.4%
      Normalized EBITDA margin                               46.0%                                           47.2%    319 bps

      Latin America North                                      2Q16   Scope       Currency       Organic      2Q17    Organic
                                                     Reference Base             translation      growth               growth
      Total volumes (thousand hls)                           27 209     - 32              -       -1 046     26 131      -3.8%
      Revenue                                                 1 920         1          144           - 34     2 031      -1.8%
      Cost of sales                                           - 734        -           - 56          - 33     - 823      -4.6%
      Gross profit                                            1 187        -             87          - 67     1 207      -5.7%
      SG&A                                                    - 636     - 12           - 54            25     - 677       3.8%
      Other operating income/(expenses)                          92        -               6         - 32        66     -34.4%
      Normalized EBIT                                           641       -9             39          - 74       596     -11.7%
      Normalized EBITDA                                         830     - 10             56          - 78       798      -9.5%
      Normalized EBITDA margin                               43.2%                                           39.3%    -334 bps




ab-inbev.com                                                                                                               18
      Annex 1
      Latin America South                                      2Q16     Scope       Currency     Organic     2Q17     Organic
                                                     Reference Base               translation    growth               growth
      Total volumes (thousand hls)                            5 999         -               -       731      6 730       12.2%
      Revenue                                                   504          1           - 33       179        650       35.4%
      Cost of sales                                           - 185         -              12       - 78     - 251      -42.0%
      Gross profit                                              319         -            - 21       101        399       31.6%
      SG&A                                                    - 149        -3              10       - 44     - 186      -29.0%
      Other operating income/(expenses)                           -          1              -          1         2           -
      Normalized EBIT                                           170        -2            - 11         58       216       34.5%
      Normalized EBITDA                                         218        -3            - 13         66       267       30.5%
      Normalized EBITDA margin                               43.3%                                          41.1%     -154 bps

      EMEA                                                     2Q16     Scope       Currency     Organic     2Q17     Organic
                                                     Reference Base               translation    growth               growth
      Total volumes (thousand hls)                           29 754     5 720               -      1 232    36 706       4.1%
                        of which AB InBev own beer           22 224      256                -      1 337    23 817       6.0%
      Revenue                                                 2 257       332            - 11        227     2 805     10.0%
      Cost of sales                                           - 970     - 229                7       - 88   -1 279      -8.9%
      Gross profit                                            1 287       103              -4        139     1 525     10.9%
      SG&A                                                    - 783     - 102              -3        - 34    - 921      -4.3%
      Other operating income/(expenses)                          14         -                1          1       15       4.0%
      Normalized EBIT                                           517         2              -6        106       619     21.0%
      Normalized EBITDA                                         688        29              -7        116       826     17.1%
      Normalized EBITDA margin                               30.5%                                          29.4%     192 bps

      Asia Pacific                                             2Q16     Scope       Currency     Organic     2Q17     Organic
                                                     Reference Base               translation    growth               growth
      Total volumes (thousand hls)                           28 900           6             -       - 21    28 885      -0.1%
      Revenue                                                 1 959         27           - 48       116      2 055       5.9%
      Cost of sales                                           - 861       - 25             22         41     - 823       4.7%
      Gross profit                                            1 098           3          - 26       156      1 232      14.2%
      SG&A                                                    - 710       - 11             16         56     - 649       7.8%
      Other operating income/(expenses)                          94          -             -2       - 53        39     -56.3%
      Normalized EBIT                                           482         -8           - 12       159        622      33.6%
      Normalized EBITDA                                         648       - 15           - 17       142        758      22.1%
      Normalized EBITDA margin                               33.1%                                          36.9%     501 bps

      Global Export and Holding                                2Q16     Scope       Currency     Organic     2Q17     Organic
      Companies                                      Reference Base               translation    growth               growth
      Total volumes (thousand hls)                                400    - 201             -          51       250      25.8%
      Revenue                                                     401    - 297             -        - 17         87    -16.3%
      Cost of sales                                           -   344      252            -4          19       - 77     20.9%
      Gross profit                                                 57      - 45           -5           2         10     18.1%
      SG&A                                                    -   386        35             5       108      - 237      31.4%
      Other operating income/(expenses)                            24        -2           -3          -4         15    -19.1%
      Normalized EBIT                                         -   306      - 10           -2        106      - 213      34.2%
      Normalized EBITDA                                       -   246      - 11           -4        110      - 150      44.2%




ab-inbev.com                                                                                                               19
      Annex 2
      AB InBev Worldwide                                       HY16    Scope       Currency     Organic      HY17    Organic
                                                     Reference Base              translation    growth               growth
      Total volumes (thousand hls)                          293 497    11 239               -       814    305 550      0.3%
                        of which AB InBev own beer          246 109     - 326               -     2 430    248 212      1.0%
      Revenue                                                 25 526      209            279      1 091     27 104      4.4%
      Cost of sales                                          -10 065      - 74         - 125      - 409    -10 674     -4.3%
      Gross profit                                            15 462      133            154        682     16 430      4.4%
      SG&A                                                    -8 575    - 218            - 93       106     -8 779      1.2%
      Other operating income/(expenses)                          492      - 68             16       - 31       408     -7.3%
      Normalized EBIT                                          7 379    - 153              77       756      8 059    10.5%
      Normalized EBITDA                                        9 346    - 101              96       821     10 162      9.0%
      Normalized EBITDA margin                                36.6%                                         37.5%    161 bps

      North America                                            HY16    Scope       Currency     Organic      HY17    Organic
                                                     Reference Base              translation    growth               growth
      Total volumes (thousand hls)                           58 439      211               -     -1 494     57 156      -2.6%
      Revenue                                                  7 795       77           - 13        - 72     7 786     -0.9%
      Cost of sales                                           -2 902     - 51              4          62    -2 887       2.1%
      Gross profit                                             4 892       26             -9        - 10     4 899     -0.2%
      SG&A                                                    -2 200     - 31              5          52    -2 174       2.3%
      Other operating income/(expenses)                           31        -              -        - 12        20    -37.9%
      Normalized EBIT                                          2 723       -4             -4          30     2 744       1.1%
      Normalized EBITDA                                        3 116       -1             -5         38      3 149       1.2%
      Normalized EBITDA margin                                40.0%                                         40.4%      87 bps

      Latin America West                                       HY16    Scope       Currency     Organic      HY17    Organic
                                                     Reference Base              translation    growth               growth
      Total volumes (thousand hls)                           52 534      - 50               -      704      53 188      1.3%
      Revenue                                                  4 123        -          - 105       242       4 259      5.9%
      Cost of sales                                           -1 199       -1              37      - 63     -1 225     -5.2%
      Gross profit                                             2 925       -1            - 69      179       3 034      6.1%
      SG&A                                                    -1 414     - 24              41        24     -1 373      1.7%
      Other operating income/(expenses)                           78     - 67              -2        24         34         -
      Normalized EBIT                                          1 589     - 92            - 29      228       1 695    15.3%
      Normalized EBITDA                                        1 903     - 92            - 38      224       1 998    12.4%
      Normalized EBITDA margin                                46.2%                                         46.9%    271 bps

      Latin America North                                      HY16    Scope       Currency     Organic      HY17    Organic
                                                     Reference Base              translation    growth               growth
      Total volumes (thousand hls)                           56 922        -5             -       - 367     56 550      -0.6%
      Revenue                                                  3 820        1           541            4     4 365       0.1%
      Cost of sales                                           -1 386        -         - 225       - 210     -1 821     -15.2%
      Gross profit                                             2 436        -           315       - 206      2 545      -8.5%
      SG&A                                                    -1 222     - 19         - 181           12    -1 410       0.9%
      Other operating income/(expenses)                          191       -1            24         - 56       157     -29.6%
      Normalized EBIT                                          1 404     - 20           158       - 251      1 292     -18.1%
      Normalized EBITDA                                        1 761     - 20           210       - 252      1 699    -14.5%
      Normalized EBITDA margin                                46.1%                                         38.9%    -664 bps




ab-inbev.com                                                                                                              20
      Annex 2
      Latin America South                                      HY16    Scope       Currency     Organic     HY17      Organic
                                                     Reference Base              translation    growth                growth
      Total volumes (thousand hls)                           14 819        -               -      1 000    15 819         6.8%
      Revenue                                                  1 231       1            - 86        377     1 523        30.7%
      Cost of sales                                            - 414       -              26      - 179     - 566       -43.2%
      Gross profit                                               817       -            - 60        199       956        24.3%
      SG&A                                                     - 323      -3              23        - 92    - 394       -28.3%
      Other operating income/(expenses)                            2       1                -          -        3        -6.7%
      Normalized EBIT                                            497      -2            - 36        106       565        21.5%
      Normalized EBITDA                                          584      -2            - 42        126       666        21.6%
      Normalized EBITDA margin                                47.5%                                        43.7%      -327 bps

      EMEA                                                     HY16    Scope       Currency     Organic     HY17      Organic
                                                     Reference Base              translation    growth                growth
      Total volumes (thousand hls)                           57 719    11 441              -        466    69 625        0.8%
                        of which AB InBev own beer           41 077       464              -      1 061    42 602        2.6%
      Revenue                                                  4 142      661             23        320     5 145        7.7%
      Cost of sales                                           -1 848    - 463             -9        - 86   -2 405       -4.6%
      Gross profit                                             2 294      197             14        234     2 740      10.2%
      SG&A                                                    -1 426    - 184           - 18        - 73   -1 700       -5.1%
      Other operating income/(expenses)                           7         1              3          31       42           -
      Normalized EBIT                                            875       14             -1        193     1 081      22.4%
      Normalized EBITDA                                        1 209       70             -2        213     1 489      17.8%
      Normalized EBITDA margin                                29.2%                                        28.9%      270 bps

      Asia Pacific                                             HY16    Scope       Currency     Organic     HY17      Organic
                                                     Reference Base              translation    growth                growth
      Total volumes (thousand hls)                           52 162      - 20              -       426     52 568        0.8%
      Revenue                                                  3 658       27           - 81       251      3 856        6.9%
      Cost of sales                                           -1 686     - 23             44         35    -1 630        2.1%
      Gross profit                                             1 972        5           - 37       287      2 226       14.5%
      SG&A                                                    -1 281     - 19             30         21    -1 249        1.6%
      Other operating income/(expenses)                          127       -1             -4       - 41        81      -32.4%
      Normalized EBIT                                            816     - 13           - 11       267      1 059       33.2%
      Normalized EBITDA                                        1 181     - 19           - 25       275      1 412       23.5%
      Normalized EBITDA margin                                32.3%                                        36.6%      499 bps

      Global Export and Holding                                HY16    Scope       Currency     Organic     HY17      Organic
      Companies                                      Reference Base              translation    growth                growth
      Total volumes (thousand hls)                               902    - 337             -          80         644     14.1%
      Revenue                                                    757    - 556             -        - 31         170    -15.4%
      Cost of sales                                            - 631      462            -2          30     -   140     17.9%
      Gross profit                                               127      - 94           -2          -1          30     -3.0%
      SG&A                                                     - 705        58            6        161      -   479     25.2%
      Other operating income/(expenses)                           56        -2           -5          23          71     41.9%
      Normalized EBIT                                          - 524      - 36           -1        183      -   378     33.1%
      Normalized EBITDA                                        - 407      - 37           -3        197      -   250     45.1%

      27 July 2017
      JSE Sponsor: Deutsche Securities (SA) Proprietary Limited




ab-inbev.com                                                                                                               21

Date: 27/07/2017 07:15:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.

Share This Story