Anheuser-Busch Cos., the nation’s biggest brewer, lowered its profit outlook for the year and said it would step up its marketing, new product and packaging efforts in light of weaker-than-expected U.S. beer volume in the first quarter. Its shares fell more than 3 percent.
The brewer of top-selling Budweiser and Bud Light said after the close of regular trading Tuesday on Wall Street that it expects earnings for the January-March period of 63 to 64 cents per share, excluding a one-time gain on the sale of its equity interest in a Spanish theme park.
The company earned 66 cents per share during last year’s first quarter, and analysts surveyed by Thomson Financial forecast earnings of 64 cents per share on $3.58 billion in revenue.
For all of 2005, the company said it believes that earnings-per-share growth in the low-single-digit range — before stock option expenses and one- time items in both years — “is a reasonable expectation at this time.”
Anheuser-Busch, scheduled to release first-quarter earnings April 27, said first-quarter sales to wholesalers slid 2.7 percent from last year’s 24.4 million barrels. Domestic beer wholesaler sales to retailers slipped 1 percent, given generally weak industry volume conditions and the comparison with the previous year’s strong showing of low-carb Michelob Ultra, the company said.
“The company has stepped up its new product, packaging and marketing efforts, but it will take time for these new initiatives to gain traction,” said Patrick Stokes, Anheuser-Busch’s president and chief executive. “Given Anheuser-Busch’s substantial competitive strengths in the U.S. beer market, we are confident the company will successfully restore its volume momentum.”
Anheuser-Busch said it expects 2005 earnings, excluding one-time items, of $2.76 to $2.84 a share, up from $2.73 a year earlier. These figures don’t exclude expenses of stock options to employees.
As wine and distilled spirits continue to gain bigger shares of the alcoholic beverage market, Anheuser-Busch in recent months has bumped up its marketing in hopes of boosting its volume of U.S. beer shipments.
Anheuser-Busch in February nationally launched Budweiser Select, a low-carb, low-calorie cousin of Budweiser and Bud Light with a darker colorer and crisper finish. Budweiser Select has 3.1 grams of carbohydrates, 99 calories and 4.3 percent alcohol by volume per 12-ounce serving, the company said.