Core Viewpoint - Diageo has entered into an agreement to sell its 65% shareholding in East African Breweries plc (EABL) and its stake in the Kenyan spirits business, UDVK, to Asahi Group Holdings, Ltd, aligning with its strategy of selective disposals of non-core assets to strengthen its balance sheet and support its commitment to de-levering [1]. Group 1 - Diageo's sale of its shareholding in EABL is part of a broader strategy to dispose of non-core assets [1]. - The transaction involves a 65% stake in EABL and includes the Kenyan spirits business, UDVK [1]. - The move is intended to strengthen Diageo's balance sheet and support its de-levering efforts [1].

We came across a bullish thesis on Ambev S.A. on CompoundingLab’s Substack. In this article, we will summarize the bulls’ thesis on ABEV. Ambev S.A.'s share was trading at $2.57 as of December 1st. ABEV’s trailing and forward P/E were 13.45 and 13.26 respectively according to Yahoo Finance. Top 5 Beer Brands in the World Pixabay/Public Domain Ambev appears undervalued, trading at roughly a 23% discount to fair value, implying potential 9% annual alpha if the gap closes within three years. The valuation ...

Core Viewpoint - The company announced adjustments to its fundraising investment projects, including content changes and extensions of completion dates for specific projects, in response to current economic conditions and market competition [1][3]. Fundraising Overview - The company raised a total of RMB 576.42 million through a non-public stock issuance, with a net amount of RMB 568.22 million after deducting issuance costs [1]. - The funds were fully received by April 1, 2019, and have been allocated to various investment projects [1]. Project Adjustments and Extensions - The completion dates for the "High-Quality Base Liquor Technology Transformation and Supporting Engineering Project" and the "Marketing System Construction Project" have been extended to December 31, 2027, due to various implementation challenges [3][4]. - The adjustments include optimizing the marketing system project by reducing investments in certain regional operation centers while increasing investments in marketing display centers and online platforms [3][11]. Reasons for Adjustments - The "High-Quality Base Liquor Technology Transformation" project has seen a 90% completion rate but faced delays due to procurement and construction issues [3][4]. - The "Marketing System Construction Project" is ongoing, influenced by intensified industry competition and slow market development, necessitating a strategic review and extension of the project timeline [3][4]. Project Feasibility and Benefits - The technology transformation project is supported by national policies encouraging upgrades in the liquor industry, with expected annual sales revenue of RMB 472.25 million and average annual net profit of RMB 66.10 million upon completion [8][13]. - The marketing system project aims to enhance the company's sales and customer service capabilities, thereby improving brand influence and market reputation [12][13]. Regulatory Compliance - The adjustments to the fundraising projects have been reviewed and approved by the company's board and supervisory committee, ensuring compliance with relevant regulations and safeguarding shareholder interests [15][16][17].

Key Takeaways BUD's premium and super-premium brands drove mix gains despite flat above-core results in the quarter.BEES GMV rose 11% year over year, with quarterly GMV surging 66% and partner count topping 500.Digital platforms contributed about 70% of revenues, with DTC reaching 11.9 million consumers.In a fast-evolving beverage environment, Anheuser-Busch InBev SA/NV (BUD) , also known as AB InBev, emerges as a distinctively positioned contender, steadily advancing its claim in the global alcoholic bever ...

Core Insights - The beer industry is experiencing a slowdown in overall growth, with companies facing challenges in increasing profits while revenues remain stagnant [2][8] - The recent "Double 11" shopping festival saw significant online sales for major beer brands, but the competitive landscape is shifting towards high-end products and diverse consumption scenarios [2][6] Group 1: Market Trends - Major beer brands like Tsingtao, Budweiser, and Yanjing dominated online sales during "Double 11," with Tsingtao's exclusive 211ml small white beer seeing a nearly 4-fold increase in sales [2] - The beer market is transitioning from a speed competition to a focus on high-end products and diverse consumption scenarios, indicating a need for innovation and adaptation [2][8] Group 2: Product Innovation - Companies are focusing on product innovation to meet changing consumer demands, with new categories like non-alcoholic and low-calorie beers gaining traction [3][9] - Carlsberg China emphasizes the importance of high-end products and fine management, while Budweiser Asia Pacific highlights the need for technological advancements in brewing processes [4][5] Group 3: Consumption Scenarios - The traditional consumption scenarios for beer are weakening, prompting companies to explore new experiences such as outdoor activities and urban street culture [6][7] - Tsingtao Beer is creating experiential venues like museums and beer gardens to enhance consumer engagement, while Carlsberg is aligning its brands with specific dining experiences [6][7] Group 4: Industry Outlook - Despite the current challenges, the long-term growth potential of the Chinese beer market remains strong, with a focus on quality and innovation [8][9] - Industry leaders stress the importance of collaboration and shared efforts to drive innovation and quality improvements across the sector [9]

Business Impact of Government Shutdown - Song Dog Distillery's launch plan is hindered by the federal government shutdown, impacting the release of new cocktails and flavors [4] - The shutdown prevents the distillery from obtaining label and formula approvals for new drinks, halting product development and sales [5][6][7] - The distillery faces potential loss of sales and repeat customers due to a limited menu during the holiday season [7][8] - Small business contractors with the government are losing $3 billion per week due to the shutdown [9] - Small businesses are facing difficulties in accessing loans and approvals, impacting their ability to operate and plan [10] Economic Consequences - An estimated 1.4 million federal workers are going without pay [8] - Federal grants and new Small Business Administration loans are paused [9] - 42 million low-income Americans are in limbo due to funding issues for food assistance [9] Industry Perspective - The Main Street Alliance, representing 30,000 small businesses, highlights the challenges faced by small business owners during the shutdown [9][10] - Small businesses must continue to pay employees and cover rent despite the inability to obtain approvals or access loans [10] - The uncertainty surrounding the shutdown's duration exacerbates the challenges faced by businesses [10]

Financial Data and Key Metrics Changes - Net revenue grew by 4% year-to-date, driven by a resilient net revenue per hectoliter growth of 7% [5][24] - EBITDA growth of 3% with a margin expansion of 50 basis points in the third quarter [5][24] - Normalized EPS increased by 8% year-over-year [5][24] Business Line Data and Key Metrics Changes - Premium and super premium brands grew mid-teens, gaining sellout market share reaching close to 50% [19] - The balanced choice portfolio grew by 36%, with non-alcohol beers expanding above 20% [7][19] - Cash COGS per hectoliter grew below net revenue per hectoliter, indicating effective cost management [6][11] Market Data and Key Metrics Changes - Brazil Beer experienced a decline in volumes, primarily due to weather conditions and consumer purchasing power constraints [12][14] - The CSD industry in Brazil saw a deceleration from low single-digit growth in Q1 to mid-single-digit decline in Q3 [20] - In Argentina, beer volumes declined mid-single digits, underperforming the industry [21] Company Strategy and Development Direction - The company aims to lead and grow the beer category by placing customers and consumers at the center of decision-making [6][8] - Digitization and monetization of the ecosystem are key pillars, with a focus on expanding the addressable market and enhancing consumer insights [9][10] - A $1 billion share buyback program was approved to return cash to shareholders, reflecting confidence in long-term value creation [6][29] Management's Comments on Operating Environment and Future Outlook - Management views the current industry headwinds as situational rather than structural, with confidence in long-term fundamentals [14][17] - The upcoming FIFA World Cup is seen as a significant opportunity to boost brand engagement and sales [31][46] - Management remains optimistic about the fourth quarter, expecting improved conditions compared to the previous year [45][46] Other Important Information - The effective tax rate decreased to 6.7% from 23.6% year-over-year, influenced by one-off effects [26] - Cash flow from operating activities totaled BRL 6.9 billion, despite softer volumes and higher cash taxes [29] Q&A Session Summary Question: Insights on COGS performance - Management attributed lower costs to a series of initiatives focused on production efficiency and cost control [35][38] Question: Beer industry environment in Brazil - Management noted that weather and consumer purchasing power were significant factors affecting volume performance, with expectations for improvement in Q4 [42][45] Question: Sustainability of SG&A reduction - Management explained that the reduction was partly due to phasing of marketing expenses and variable compensation adjustments, while also emphasizing ongoing investments in sales and marketing [57][60] Question: Pricing strategy and volume reaction - Management indicated that the price increase had minimal impact on industry performance, with a focus on maintaining prices in line with inflation [65][66] Question: Performance in Argentina and Bolivia - Management highlighted strong results in Bolivia offsetting challenges in Argentina, with confidence in long-term prospects for both markets [77][78]

Financial Performance - The company's EBITDA increased by 3.3% in 3Q25[12] - The company's revenue per hl grew by 4.8% in 3Q25[13] - The company announced a share buyback program of $6 billion[12] - The company announced a debt redemption of $2 billion[12] - The company announced an interim dividend of €0.15 per share[12] - The company's underlying EPS (USD) increased by 1.0%[13] Regional Performance - North America's revenue decreased by 0.7%[17] - Middle Americas' revenue increased by 4.2%[17] - South America's revenue increased by 2.0%[17] - EMEA's revenue increased by 3.0%[17] - APAC's revenue decreased by 9.0%[17] Brand Performance - No-alcohol beer revenue increased by 27%[12] - Beyond Beer revenue increased by 27%[12] - BEES Marketplace quarterly GMV increased by 66%, approaching $1 billion[12]

Financial Data and Key Metrics Changes - In the first nine months of 2025, total volumes decreased by 7%, revenue decreased by 6.6%, while revenue per hectoliter increased by 0.4% [7] - Normalized EBITDA decreased by 7.7%, and the normalized EBITDA margin contracted by 37 basis points [7] - In the third quarter, total volumes and revenue decreased by 8.6% and 8.4%, respectively, with normalized EBITDA decreasing by 6.9% but the normalized EBITDA margin expanding by 46 basis points [7] Business Line Data and Key Metrics Changes - In APAC West, volumes and revenue decreased by 7.9% and 8.7%, respectively, with normalized EBITDA decreasing by 9.7% [8] - In China, volumes in the third quarter decreased by 11.4%, revenue decreased by 15.1%, and revenue per hectoliter decreased by 4.1% [8] - In APAC East, volumes decreased by 0.5%, while revenue and revenue per hectoliter increased by 1.8% and 2.3%, respectively [12] Market Data and Key Metrics Changes - In India, the company delivered double-digit revenue growth in the third quarter, translating into strong EBITDA performance [11] - In South Korea, volumes were flattish, with revenue and revenue per hectoliter both growing by mid-single digits [12] Company Strategy and Development Direction - The company is focused on improving top-line performance by enhancing route-to-market strategies, increasing investment in mega brands, and leading innovation within the industry [9] - The strategy includes expanding the in-home channel and premiumizing the product offerings to capture growth opportunities [9][10] - The company aims to restore excellence in execution and improve market share momentum [4][5] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in China due to a soft economic cycle but emphasized a clear view of improvement opportunities [4] - The company remains committed to operational excellence and is optimistic about long-term growth despite current market conditions [5][11] Other Important Information - The company continues to leverage technology to enhance commercial capabilities and optimize route-to-market strategies [11] - The performance in South Korea and India has been solid, with ongoing investments in marketing and product innovation [11][12] Q&A Session Summary Question: Insights on brand performance in China - Management highlighted the importance of aligning brand performance with channel strategies, particularly focusing on in-home consumption and innovations [18][20] Question: Demand trends in Korea - Management noted that while the overall industry remains soft, there are pockets of growth in non-alcoholic and flavored beers, and the company is well-positioned to capture these opportunities [25][27] Question: Outlook for the China market - Management confirmed proactive inventory management and a focus on maintaining healthy route-to-market strategies, with expectations for gradual improvements [30][31] Question: In-home channel penetration - Management indicated that the in-home channel currently accounts for over 50% of their mix, with plans to increase this closer to the industry average [32][34] Question: Branding strategy for Harbin - Management expressed confidence in the Harbin brand's ability to compete nationally, particularly in Guangdong, and emphasized the need for a diverse portfolio to meet local consumer needs [39][42] Question: Commercial investment allocation - Management stated that investments are being sustained in both on-trade and off-trade channels, with a shift towards in-home channels as consumer preferences evolve [66][68] Question: Updates on Korean customs tax dispute - Management confirmed that the dispute is ongoing, with non-underlying charges recorded, but emphasized that the potential penalty exposure is not expected to be material [72][74]

Core Viewpoint - Molson Coors Brewing (TAP) is anticipated to report a year-over-year decline in earnings due to lower revenues for the quarter ended September 2025, with the actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The consensus estimate for Molson Coors' quarterly earnings is $1.72 per share, reflecting a year-over-year decrease of 4.4%. Revenues are projected to be $3.03 billion, down 0.4% from the same quarter last year [3]. - The consensus EPS estimate has been revised down by 3.84% over the last 30 days, indicating a reassessment by analysts regarding the company's earnings outlook [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for Molson Coors is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -1.53%. This suggests a bearish sentiment among analysts regarding the company's earnings prospects [12]. - The stock currently holds a Zacks Rank of 4, which complicates the prediction of an earnings beat [12]. Historical Performance - In the last reported quarter, Molson Coors was expected to post earnings of $1.83 per share but exceeded expectations with actual earnings of $2.05, resulting in a surprise of +12.02%. Over the past four quarters, the company has beaten consensus EPS estimates three times [13][14]. Market Reaction Factors - An earnings beat or miss may not solely dictate stock price movements, as other factors can influence investor sentiment. Stocks may decline despite an earnings beat or rise despite a miss due to unforeseen catalysts [15]. - It is suggested that focusing on stocks expected to beat earnings expectations can enhance investment success, highlighting the importance of monitoring Earnings ESP and Zacks Rank prior to earnings releases [16].