Anheuser-Busch Q3 2008 Earnings Call Transcript

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2008-11-06 11:17:10.0

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Question-and-Answer Session

Operator

(Operator Instructions) Our first question comes from Kaumil Gajrawala with UBS.

Kaumil Gajrawala - UBS

Randy, can you talk a little bit about what you have seen in volumes after the price increases, and if you are finding that consumers are a little more price elastic than in the past, given the economy? Thanks.

W. Randolph Baker

Kaumil, you broke up on the call, or at least the audio that we heard. I believe your question was what are we seeing in volume post price increase.

Kaumil Gajrawala - UBS

Yes, that’s right.

W. Randolph Baker

Our volume in October was down 1.8%. The first three weeks were soft. Last week was strong. This was generally in line with our expectations following a very strong September. Our September STRs were up essentially mid-single-digits and that reflected both the strong Labor Day and the volume build ahead of the price increase.

We’re not seeing any change in shall we say price elasticity or consumer reaction to the price increases. Our price increases are relatively moderate, moderate relative to what other beverage and food companies have taken this year, and the price increases have been well accepted by the retailers, consumers as well.

Operator

Our next question comes from Mark Swartzberg with Stifel Nicolaus.

Mark Swartzberg - Stifel Nicolaus

Really just to clarify what you said at the end there about being on track to deliver or exceed the targets you laid out on June 27th -- so to be super clear, you are saying that in spite of the equity income disappointing in the quarter and presumably continuing to be below what you had talked about a few months ago, that is being more than offset or effectively offset by your view of what is happening here domestically?

W. Randolph Baker

That’s a fair statement. We’re really -- my remarks were focused down through the operating income line but we would still be on target with the lower-than-expected equity income. I’ll also, Mark, note that in the June 27th call, we had significant share repurchase spendings. That was suspended due to the agreement with InBev, so we do have differences in both the interest expense line and per share lines.

Operator

Your next question comes from Judy Hong with Goldman Sachs.

Judy Hong - Goldman Sachs

Just a couple of questions, one is with respect to the InBev transaction, in the proxy statement it made it sound like you were going to file the China notification in October and I’m just wondering if that’s [been made].

 

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