BUD APAC Shares Plunge Over 5%, Nearing Record Low on Weak Q2 Performance and Margin Pressure

Stock News06-30

BUD APAC (HKG: 01876) shares have plummeted more than 5%, hitting a low of HK$6.05 and approaching its previous historical low of HK$5.958. As of the latest report, the stock is down 4.55% at HK$6.08, with a turnover of HK$54.0415 million.

Analysts point to a weaker-than-anticipated performance in the second quarter. A recent research report suggests that, due to adverse weather conditions in China and weak dine-in demand, BUD APAC's volume in the Asia Pacific East market is forecast to decline by 1.3% year-on-year for Q2. The average selling price is expected to remain flat, as improvements in the premium product mix and deleveraging in China are offset by higher cost of sales, putting pressure on gross margins.

Further analysis indicates that the company's second-quarter results are likely to be softer than expected, with forecasts for organic revenue and EBITDA declining by 1% and 8% year-on-year, respectively, a trend similar to the first quarter. The Chinese market continues to be a drag on overall performance, impacted by unfavorable weather and a slower-than-expected recovery in the foodservice channel. Both product volume and average selling price are projected to fall. Additionally, increased expenditures related to World Cup promotions and new product launches are expected to further suppress profit margins.

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