Inflation Hits Anheuser-Busch, CFO Says Price Increase On Cards

• Anheuser-Busch InBev SA/NV (NYSE: BUD) mulls raising prices for some of its beverages in an effort to manage inflation.

• As per Wall Street Journal, the company said that despite regular updates to its pricing, it is lagging on cost increases in markets, including the U.S. and Brazil.

• “Overall, I feel inflation is slightly higher than our view,” AB InBev CFO Fernando Tennenbaum said.

• In the U.S., the consumer price index (CPI) was at 8% in Q1. Still, AB InBev’s total net beer revenue per hectoliter (100 liters) increased 6.2%.

• In Brazil, CPI rose 10.7% in Q1 compared to an 8.5% increase in total net revenue per hectoliter, the company said.

• Mr. Tennenbaum declined to provide specifics on AB InBev’s pricing strategy. “Pricing is only one of the levers we have to manage cost inflation,” a spokeswoman said.

• The company uses zero-based budgeting to keep costs under control. The managers will have to plan every budget from scratch, which many consumer-facing businesses use. “It’s a mindset,” Mr. Tennenbaum said.

• Photo via Wikimedia Commons

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