CORRECTION: Corona Reports Huge Losses After Outbreak Of Coronavirus
CORRECTION: This story has been updated to reflect the fact the brewing company AB InBev, which is behind Corona, Budweiser, Stella Artois and others, has forecast around a 10% drop in first quarter earnings for this year, after the outbreak of coronavirus in China coincided with the Chinese New Year, causing demand for the products to decrease. It is not because of an apparent ‘fear’ of Corona beer, as some reports suggested.
A spokesperson for AB InBev said: ‘The impact of the Covid-19 virus outbreak on our business continues to evolve. The outbreak has led to a significant decline in demand in China in both on-premise and in-home channels. Additionally, demand during the Chinese New Year was lower than in previous years as it coincided with the beginning of this outbreak.’
The company that owns Corona beer is experiencing its biggest losses in a decade as a result of the coronavirus outbreak.
Anheuser-Busch InBev owns not only Corona, but other famous brands such as Budweiser, Stella Artois and Becks, too.
However, the company is now forecasting a 10% drop in earnings for the first quarter of this year, due to current demand being lower than usual.
Anheuser-Busch In Bev has cited the loss in sales to few people visiting China and less people going out in public, in a bid to prevent the spread of the coronavirus. Therefore, the impact is taking a toll on nightlife in the country, as many bars and restaurants being forced to close their doors.
The Belgium-based company usually sells more lager in the Chinese market than in the whole of the United States.
CEO Carlos Briton told CNBC:
Our business is all about going to restaurants, to nightlife, going out with friends, it’s really about to go back to normal, we’re preparing for the surge when things return to normal.
As we look to the future, we are determined to lead growth through consumer-centricity, operational excellence and innovation.
Our performance in 2019 was below our expectations, and we are not satisfied with these results.
According to AB InBev, first quarter sales figures in Brazil in 2020 would not match their strong sales in 2019’s first quarter because a later-than-usual Carnival, which at the time increased revenue by 16.7%.
The World Health Organisation chief is now urging governments to take ‘aggressive’ action against the spread of the coronavirus, which has now reached a ‘decisive point’.
Tedros Adhanom Ghebreyesus said:
Every country must be ready for its first case, its first cluster, the first evidence of community transmission and for dealing with sustained community transmission. And it must be preparing for all of those scenarios at the same time.
It comes after the panic surrounding the coronavirus sent world share markets sinking again on Friday, February 28, wiping out a value of $5 trillion in what has been described as the worst week since the 2008 financial crisis.
For more information from the World Health Organization on Coronavirus, click here.
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