The Best Beer Company in a Better World - Anheuser-Busch InBev

Volumes
Financial Report Annual Report 2008 | 45
The table below summarizes the volume evolution per zone and the related comments are based on organic numbers. The 2008 volumes include
the Anheuser-Busch volumes for the period of 18 November 2008 to 31 December 2008. The 2007 volumes are pro-forma volumes and include
the Anheuser-Busch volumes for the comparative period of 2007. Volumes include not only brands that we own or license, but also third party brands
that we brew as a subcontractor and third party products that we sell through our distribution network, particularly in Western Europe. Volumes sold
by the global export business are shown separately. Our pro-rata stake of volumes in Modelo and Tsingtao is not included in the reported volumes.
Thousand hectoliters Pro-forma 2007 Scope Organic growth 2008 Organic growth %
North America 25 734 83 788 26 605 3.1 %
Latin America North 100 877 (323) 965 101 519 1.0 %
Latin America South 30 524 - 3 174 33 698 10.4 %
Western Europe 36 308 (850) (1 705) 33 753 (4.8) %
Central and Eastern Europe 49 137 - (2 994) 46 142 (6.1) %
Asia Pacific 38 299 - 38 38 337 0.1 %
Global Export and Holding Companies 4 765 68 (167) 4 666 (3.4) %
Worldwide 285 644 (1 023) 99 284 719 -
2008 consolidated volumes were flat. AB InBev’s own beer volumes decreased 0.3 %, slightly ahead of overall beer volumes, which declined
by 0.8 %, as a result of the ongoing focus on growing our own branded volumes.
Our focus brands, i.e., those with greater growth potential within each relevant consumer segment, have performed well. For full year 2008,
they have significantly outperformed total and own beer sales, with volume growth of 2.6 %, even in a difficult environment.
Our global brands, Stella Artois and Beck’s, grew 0.3 % in 2008. Stella Artois delivered strong double digit growth in Canada, Argentina
and US, offset by soft volumes in other markets. Beck’s performance was positive in many countries such as the UK and Germany, but the
brand experienced volume loss in the US.
We continued to invest in brand building, increasing our spending on marketing and sales, as reflected in the increase of commercial expenses
of 8.4 % in 2008. We intensified our product renovation and innovation, which has further improved the performance of our focus brands.
Our innovative Stella Artois 4 %, launched in the third quarter of 2008, delivered very good results in the fourth quarter and supported the
Stella Artois brand’s first market share gain in the UK since 2003.
2008 soft drinks volumes grew by 4.9 %.
North America : our total 2008 volumes increased 3.1 %, including the Anheuser-Busch US beer volumes as of 18 November 2008 and in the
comparison base in 2007, providing a fair view of the underlying organic performance of our combined North American business. In Canada,
2008 own beer volumes grew 1.1 %, and our brands, especially Budweiser, and Bud Light, performed well. Imports to Canada have maintained
their strong volumes, led by Stella Artois. The launch of the Stella Artois Légère line extension drove the double-digit growth and brand health
improvement for the Stella Artois brand. In addition, we gained 0.2 market share points in the country, driven by share gains in Quebec and
the Prairies. Since 18 November 2008, United States domestic beer volumes delivered organic shipment volume growth of 4.9 %, compared
to the same period in 2007. In 2008, domestic US beer shipments grew 1.6 %, ahead of the industry, leading to shipment share gains of 0.5
share points. This share gain was driven by wholesaler inventory levels returning to a normal level by year-end and the successful introduction
of Bud Light Lime. Domestic US beer sales-to-retailer (STR) increased 1.1 %, and STR share grew 0.2 pp, driven by strong gains in the
supermarket/supercenter segments. In addition to this, share performance improved across all major retail channels in the second half of
2008. Shipment volumes of our European imports into the US declined by 1 % in 2008. However, Stella Artois shipments maintained their
strong growth and delivered 17.8 % growth for 2008, while sales-to-retailer of Stella Artois were 26.7 % above last year.
Latin America North : volumes were 1.0 % higher in 2008, with beer flat and non-beer growing 3.6 %. In Brazil, 2008 beer volumes grew 0.2 %
as the weather continued to be colder and more humid than the same period in 2007. In addition, food inflation increased by twice the level
of general consumer inflation, putting pressure on consumer spending. In 2008, due to price increases and aggressive competitor behavior
in can pricing, our full year market share was 67.5 %, a decrease of 0.3 pp from the previous year. The performance of Stella Artois indicates
its potential for the country, growing by 39.8 % in 2008, on a still small base. Our Brazilian soft drinks business posted volume growth of 2.8 %
for 2008, coupled with strong market share performance in Brazil throughout 2008.
Latin America South : the zone showed strong volume growth of 10.4 % in 2008, with beer contributing 11.5 % and non-beer 8.7 %.
In Argentina, our 2008 beer volumes grew 11.4 %, ahead of industry growth. Our strong performance results from our focus on the premium
segment, as well as successful focus brand marketing and innovation initiatives. 2008 was a good year of market share growth in Argentina
up 1.9 pp compared to the previous year. Stella Artois is the number one international beer brand in Argentina, and grew by almost 60 %
in 2008. Soft drink volumes for 2008 grew 8.2 % in Argentina, ahead of the industry, recording strong market share growth for 2008.