JOHANNESBURG - Anheuser-Busch InBev (AB InBev) is slashing its dividend by half to save R18 billion as Covid-19 shuts bars and curbs beer drinking.
The JSE and New York-listed brewery giant announced today that it was revising its final dividend for 2019 to 50 cents per share from an original proposal of €1 (Euro) due to the coronavirus. The company also announced it was rescheduling its ordinary and extraordinary shareholders’ meeting to June 3 from April 29.
InBev whose global brands, Budweiser, Stella Artois, and Corona in February warned that the coronavirus in China had hit its sales in the first two months, despite the increase in global volume growth on premiumisation and management initiatives.
The group, which is the world’s largest beer said that the outbreak resulted in lost revenue of about $285 million (R4.34 billion) and earnings before interest, tax, depreciation and amortisation (Ebitda) of about $170m in China. It said Ebitda was expected to decline by about 10 percent in the first quarter of 2020 and off a high base in the first quarter of 2018.
Political parties have taken a united stand to oppose calls by the liquor industry for the government to lift its ban on the sale of alcohol during the lockdown which President Cyril Ramaphosa has since extended by two weeks.
This follows weekend calls by the Gauteng Liquor authority for the government to relax its ban on the sale of liquor.
The organisation, which represents 20 000 shebeen and tavern owners, also threatened to take legal action against Ramaphosa at the Constitutional Court, telling him that he had until today to relax the ban.
Presidency spokesperson Khusela Diko said the Presidency had noted the representations made by the Gauteng Liquor Forum to Ramaphosa.
“In essence, the board has raised concerns about the economic impact the restriction of the sale of liquor has on its clients. Concerns regarding the potential economic impact of lockdown measures, not only on liquor traders but small businesses in general, are receiving the necessary requisite attention from the government.”
She said there were a number of associations who also operated in the liquor industry who had distanced themselves from the call to relax the lockdown regulations, understanding the need for these measures at this time.