Christopher Rossbach, Chief Investment Officer at London-based private investment office J. Stern & Co, said:
“This was a good enough close to the year for the group, and the shares have continued to climb since it announced its results. Revenues during the fourth quarter were of particular note, ahead by 8.2%, well ahead of the consensus, with its global brands business a real highlight after showing growth 17.8%
“The business also continues to deliver cost savings and synergies following the merger with SAB, delivering USD 381m in the fourth quarter alone to take savings to USD 1.3bn for 2017. Since the takeover it has achieved total cost savings of USD 2.1bn. However, management indicated that they are determined to grow revenues not just keep on cutting costs, talking about category expansion and strategy.
“Looking ahead, the company is guiding for a slightly softer first quarter– quite conservative after the last quarter’s figures – which is likely to do with the timing of marketing expenses for the World Cup this year blamed. Nonetheless, they had a reasonable fourth quarter, and should have a few tailwinds at their back now enabling the business to press on in 2018. The stock has been out of favour but, as the market has shown since it announced its results, the numbers are supportive of our long-term investment case.”
Andrew Ehrensperger , MRM
020 3326 9903