South Africa: AB InBev to report on South Africa commitments in the next few weeks

Brewing multinational Anheuser-Busch InBev (AB InBev) would in the next few weeks release a comprehensive report on the various public interest commitments agreed with the South African government, AB InBev Africa and SAB Zone President Ricardo Tadeu said on March 1.

The public interest commitments include a R1billion investment over five years in areas such as agriculture as well as enterprise and supplier development.

As part of the conditions for the deal, AB InBev also undertook that there would be no job losses as a result of the transaction.

The company and the Department of Economic Development agreed on the public interest conditions after Minister of Economic Development Ebrahim Patel intervened in the merger between AB InBev and SAB.

The report, the first of several in the next five years, will give indications of the initial social and economic benefits of the mega-transaction between the two major brewers.

Speaking to journalists in Johannesburg about the company’s first year of operating in Africa, Tadeu said that the company’s report on the public interest commitments was in final stages of approval.

“We have to report (on the public interest commitments) for the next five years. We have a board that we report to. There is constant follow-up,” he said.

He said the company had finalised the report, which he said could be released in a matter of weeks.

“We are going through a period of validation. There are government officials who look at what we have reported. The government officials will validate the information. That will happen in the next few weeks,” he said. The report was also audited.

He said in the last year, the company was preoccupied with restructuring and consolidation.

“That phase is now over. (The current financial) year will be stable. There will be lots of opportunities such as the World Cup. The World Cup is a great moment for us in terms of consumption and driving brands such as Budweiser,” Tadeu said. “Budweiser beer is a World Cup sponsor.”

In the past year, the company carried out a restructuring programme while simultaneously ensuring that it continued to grow. “We are glad that we grew beer volumes in every country we operate in,” Tadeu said. AB InBev has presence in 12 African countries including Nigeria, Ghana, Uganda, Tanzania, Botswana, Mozambique, Swaziland and Lesotho.

Tadeu said that in the past year the company's South African beer revenues increased by 6percent, while beer volumes were up 0.9percent.

AB InBev on March 1 released the full-year results for 2017. “Our high-end portfolio, led by Stella Artois, Corona and the recent seeding of Budweiser, showed consistent growth in volumes and market share gains throughout (2017), finishing the year with triple-digit growth.

“In the near beer segment, Flying Fish recorded more than 60percent growth during (2017). In the core plus segment, Castle Lite had another year of consistent growth,” the company said.

Tadeu said the company prioritised the accessibility of its premium brands such as Budweiser, Stella Artois and Corona.

As a result, the company last year embarked on a R2.8bn capital expenditure programme in South Africa. This entailed the expansion of current brewing capacity through the installation of new packaging lines.

The company last year announced that it would expand its breweries in Alrode near Johannesburg and Rosslyn in Pretoria.

01 March, 2018