Corona beer’s brewer Budweiser APAC posts net loss of US$41 million in first quarter as coronavirus forced bars, nightclubs, to close

Budweiser Brewery Company APAC, the largest brewer in Asia by market share, suffered a painful net loss of US$41 million in the first quarter, a far cry from profit of US$259 million a year ago, as the coronavirus pandemic forced nightclubs and restaurants to close.

The regional arm of Anheuser-Busch InBev Group, which owns beer brands such as Corona, Hoegaarden and Stella Artois, said its quarterly revenue dropped 39 per cent to US$956 million during the period.

Volumes tumbled 42.3 per cent in the three months ended March 31 as sales were hammered by the health crisis, particularly in China and South Korea.

Revenue from the Chinese market declined 45.4 per cent as the company recorded “almost no activity” from nightlife channels after restaurants and bars were abruptly closed in January and February to contain the spread of Covid-19. The only business channel that grew was the company’s e-commerce sales.

“Despite a very challenging first quarter, our business has been improving consistently week-over-week since mid-March, driven by the recovery in China and South Korea,” said chief executive Jan Craps. The beer maker has reopened all its breweries, except some in India which remains in lockdown.

The company estimates over 85 per cent of restaurants have reopened in China by late April. They expect April sales volumes in its largest market to have declined by 17 per cent, improving from the 46.5 per cent drop during the first quarter.

Budweiser raised US$5 billion on the Hong Kong stock exchange in September, making it the fourth largest initial public offering worldwide last year, but its share price has fallen almost 20 per cent since its debut. The stock slumped 24 per cent in the first quarter, but has rallied 8.8 per cent since April 1.

Its share price was down 2.5 per cent to HK$21.20 at the close.