Anheuser-Busch InBev SA/NV — FY2022 Form 20-F
Period and context. This is an annual report for the fiscal year ended December 31, 2022, prepared under IFRS and reported primarily in U.S. dollars. It is not a standalone fourth-quarter filing; the supplied filing text does not provide clear Q4-only financial results. AB InBev brews and sells beer, other alcoholic beverages and non-beer beverages across more than 150 countries. Reported volume was 595.1 million hectoliters.
Key financial results
| Metric | FY2022 | FY2021 | Change |
|---|---|---|---|
| Revenue | $57.786 billion | $54.304 billion | +6.4% |
| Volume | 595.1 million hl | 581.7 million hl | +2.3% |
| Gross profit | $31.481 billion | $31.207 billion | +0.9% |
| Profit from operations | $14.517 billion | $13.824 billion | +5.0% |
| Normalized EBITDA | $19.843 billion | $19.209 billion | +3.3% |
| Profit for the year | $7.597 billion | $6.114 billion | +24.3% |
| Profit attributable to AB InBev equity holders | $5.969 billion | $4.670 billion | +27.8% |
| Basic EPS | $2.97 | $2.33 | Up |
| Operating cash flow | $13.298 billion | $14.799 billion | -10.1% |
| Free cash flow | $8.460 billion | $9.301 billion | -9.0% |
Margins. Approximate gross margin was 54.5% versus 57.5% in 2021; operating margin was 25.1% versus 25.5%; and Normalized EBITDA margin was 34.3% versus 35.4%. These calculations use reported revenue and the respective profit measures.
Debt and liquidity. Net debt was $69.7 billion, down from $76.2 billion; interest-bearing loans and borrowings were $79.9 billion. Cash, cash equivalents and short-term debt investments, net of overdrafts, totaled $9.9 billion. Total liquidity was $20.0 billion, including a fully undrawn $10.1 billion revolving facility. Management targets net debt/Normalized EBITDA of about 2x; the year-end figures imply roughly 3.5x. About 94.3% of interest-bearing financial liabilities bore fixed rates after hedging.
Material changes versus FY2021
- Revenue increased 6.4%, while volume grew 2.3%. Excluding currency translation, acquisitions/disposals and commercial-classification changes, revenue rose 11.2% and revenue per hectoliter rose 8.6%, reflecting pricing and premiumization.
- Cost of sales rose 13.9% reported and 18.4% excluding specified currency and structural effects; cost per hectoliter rose 15.8%. Management cited commodity, logistics and transactional foreign-exchange headwinds.
- Operating cash flow declined by $1.5 billion, chiefly reflecting working-capital movements, including higher inventory; working capital reduced cash flow by $346 million, versus a $2.459 billion inflow in 2021.
- Net finance cost fell to $4.148 billion from $5.609 billion, including favorable derivative mark-to-market effects and bond redemption gains. The 2021 comparison included substantial bond termination losses.
- Reported profit included a $1.143 billion non-cash impairment of the AB InBev Efes investment, recognized in exceptional share of results of associates. The company said it was forfeiting financial benefits from the associate and pursuing a sale of its stake.
Outlook, commentary and risks
- 2023 outlook: Management expected revenue growth from a healthy combination of volume and price; net capital expenditure of $4.5–$5.0 billion; average gross debt coupon of about 4%; and pension net interest and accretion expense of $200–$230 million per quarter, subject to currency and interest-rate movements.
- Management identified inflation, commodity and energy costs, foreign exchange, interest rates, weaker consumer demand, competition, and Russia-Ukraine-related disruption as significant risks. The company reported a $2.1 billion unfavorable currency translation impact on 2022 revenue and a $397 million negative impact on operating profit.
- Brazilian tax credits contributed $201 million of other operating income and $168 million of finance income in 2022. The effective tax rate was 18.6%, including a $350 million benefit from a reorganization and use of tax attributes.
- Possible—but not probable—contingencies include significant tax disputes, particularly in Brazil. Examples include assessed amounts of $1.8 billion for an ICMS tax issue, $2.6 billion for interest-on-equity deductions, and $2.4 billion for deductions of taxes paid abroad; no provisions were recorded for these matters. These are distinct proceedings and should not be added as a single expected loss.
- Other notable exposures include the Belgian excess-profit ruling proceedings; a Tanzania tax assessment of $0.4 billion; and a South African preliminary tax finding of $0.4 billion, plus unspecified potential penalties and interest. Management states it intends to contest these matters.
- AB InBev reported goodwill of $113.0 billion and indefinite-lived intangible assets of $37.7 billion. No goodwill impairment was warranted in the 2022 annual test, but valuations depend on assumptions including future growth, discount rates and terminal growth.
- The company reported no material impact from the cybersecurity incidents it experienced in 2022. Its auditor concluded internal control over financial reporting was effective; the audit identified goodwill/intangible impairment testing and uncertain tax positions as critical audit matters.
Investor verification priorities
- Review the audited statements and confirm the distinction between annual figures and any Q4-only results; the supplied text provides no clear standalone Q4 figures.
- Reconcile reported growth with currency, pricing, volume, acquisitions/disposals and commercial-classification effects, and assess whether cost inflation is continuing to pressure margins.
- Track debt reduction against the approximately 2x leverage objective, and examine debt maturities, refinancing costs and the sustainability of cash generation and dividends.
- Assess the status and potential outcomes of the AB InBev Efes stake sale and the $1.143 billion impairment, including any remaining license or regulatory issues.
- Review the Brazilian and other tax disputes, recorded provisions versus disclosed possible losses, and the assumptions underlying the effective tax rate and tax-credit benefits.
- Confirm shareholder approval and payment of the proposed FY2022 dividend of €0.75 per share. The filing also reports the Stichting’s 33.42% voting interest and 42.44% combined voting rights for entities acting in concert.