Beer market of Russia 2016: PET goes to draftThe beer market of Russia was warmed up by the hot summer, but the preparation for large volume PET prohibition has already impacted it negatively. The year was successful for Efes, MBC and regional producers; Carlsberg’s positions were virtually stable but AB InBev and Heineken lost a part of market share having focused on the sales profitability. The dynamics of big brands was determined by how much the companies were willing to keep the prices down or by their promotional activity. In this context the economy segment of the beer market and sales of inexpensive draft beer were increasing. The premium segment started shrinking due to license brands migrating to the mainstream segment.
Beer market of Vietnam: “Young tiger”Vietnam is one of the few big beer markets that continue to grow steadily. The beer popularity results from its low price, street consumption culture, and social motives. The outlooks of beer market as well as the Vietnamese economy inspire optimism, though the country is heavily dependent on export of goods. The state regulation can be called liberal, but the key risk for brewers is harbored in intensive rising of excise. Within TOP-4 there are two leaders, Sabeco and Heineken that grow at the fastest rates. The first company effectively employs its capacities, the second one focuses on marketing technologies. Almost 80% of the market belongs to century-old brands, yet the middle class and the youth are shifting their interest toward international premium that is growing taking share from the mainstream.
Analysis of beer market in China (on Russian)
Beer market of Ukraine: big three losing weightIn 2016, fast increase of excises and resulting price spike stood in the way of the beer market stabilization. Most of competition (as well as mass sorts) moved to the economy segment of the market. The biggest losses were incurred by the leading three, especially Obolon, which again experienced pressure after reallocation of Efes market share. However, one should already speak of TOP-4. Group Oasis CIS (PPB) became a strong player and competitor to transnational companies. Besides the net sales of many regional medium breweries look rather good and 16-fold cost reduction wholesale trade license for craft brewers opens up a possibility of rapid growth in 2017.
China. AB InBev financial results of 2015 and expectations for 2016
The total industry volumes in China were estimated to have declined by approximately 6% in FY15, mainly driven by continuing economic headwinds, with most of the impact being felt in the value and core segments.
Company’s own beer volumes grew by 0.4% in FY15 and were marginally down in 4Q15.
AB InBev management comments the figures: “We estimate that on an organic basis, we gained approximately 100 bps of market share in FY15, reaching 18.6%, driven by our commercial strategy of growing our premium and super premium brands nationally, and increasing distribution in the growth channels”.
The combined volumes of Core+, Premium and Super Premium Brands grew by double digits in the year, and now represent more than 50% of the total China volume.
AB InBev revenue in China increased by 9.8% in FY15, and by 13.9% in the quarter. Revenue per hl grew by 9.4% in FY15, with the majority of the increase coming from improved brand mix driven by the growth of Budweiser and the super-premium portfolio.
China EBITDA grew by 33.7% in FY15, driven by strong top-line growth, operational efficiencies, as well as a one-time gain reported in 4Q15.
The industry volumes are expected to remain under pressure in FY16. Company’s volumes are expected to perform better than the industry, driven by premium and super premium brands.
AB InBev is also developing the near beer segment. It is just one way in which company is responding to consumer demand for more choice and excitement. In particular, they are competing more effectively for share of total alcohol by launching innovative products that offer malt beverage alternatives to wine and hard liquor. This near beer category is considered to be a major global opportunity. For example, variants of MixxTail product are now sold in Argentina, the US and China. The success of Skol Beats Senses in Brazil led the company to introduce Cass Beats in South Korea. The popularity of brands such as Cubanisto in the UK, France and Belgium also shows the potential of the flavored beer category.
26 Feb. 2016