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Bud Sales Still Slipping

With August Busch IV poised to deliver his first big “State of the Company” address to investors next week, he may have to do a little dancing to satisfy the concerns of shareholders and the financial analysts. According to Wall Street, profits from beer over the past two years have fallen an average of 1%, while Anheuser-Busch‘s profits have dipped around 12% during the same period.

Despite efforts to get the numbers on core brands up, sales did not rebound as hoped, with revenue up only 5%. Goldman Sachs analyst Judy Hong laid the blame on imports and craft beers, though recent reports have indicated that import sales are suffering the same declines and slowing as mainstream beer, leaving the craft segment as the only shining star in an otherwise dismal beer industry snapshot.

Hong also said that “Anheuser-Busch largely sat on the sidelines as the global brewing industry underwent a massive consolidation, and prospects of capturing significant growth abroad appear limited,” which seems strange since they appointed Bob Lachky last fall to specifically manage their international business and snapped up new import brands for their portfolio — including beers from international brewing giant InBev — yet a Forbes article echoed similar worries, suggesting that “the company has focused on operations abroad, though the chance to gain real exposure to international beer markets may have passed.”

A separate Forbes article, meanwhile, placed the blame for A-B’s woes on a “shift in consumer tastes to wine, spirits and microbrews” — there’s the craft beer segment again figuring heavily in business analysis. Staff writer Tom Van Riper also indicated A-B was struggling to overcome its “passé image” by spending wildly to reach a younger customer, presumably on such projects as Here’s to Beer, Bud.TV and Mingle Now.

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