Anheuser-Busch Better Positioned for Long-Term Growth

    Anheuser-Busch Better Positioned for Long-Term Growth 
 
                Strategies Capitalize on Changing Marketplace 
 
    NEW YORK, Nov. 29 -- Anheuser-Busch management reviewed the company's 
strategies to adapt to the changing beer industry environment and reaffirmed the 
company's expectation for earnings per share growth for the full year 2007 to 
exceed its 7 to 10 percent long-term objective(1), in a presentation given to 
investors and analysts in New York 
today. 
    "The last two years have been a period of considerable change in the beer 
industry and especially at Anheuser-Busch.  Anheuser-Busch has taken 
significant steps to adjust to the changing beer consumer.  We have 
substantially expanded our portfolio.  To support this broadened portfolio, we 
have transformed our selling system to make it both more personal and high 
tech at the same time.  We have also been making changes in marketing and 
media, with more significant changes planned for next year.  Anheuser-Busch is 
clearly better positioned for long-term growth due to these changes than we 
were two years ago," W. Randolph Baker, vice president and chief financial 
officer of Anheuser-Busch Companies, told the investors. 
    Baker added that perhaps the most encouraging development in the U.S. beer 
environment in the last two years has been the acceleration of growth in the 
consumer demand for beer.  Last year, beer industry shipment volume grew 2.1 
percent, the best annual performance since 1990, and this year beer industry 
growth has continued to exceed expectations, up 1.8 percent October  
year-to-date. 
    In addition to the strong industry volume growth, the industry pricing 
environment has been favorable the past two years. Consistent with the pattern 
in recent years, Anheuser-Busch plans to implement price increases on the 
majority of its U.S. beer volume in early 2008, with increases in several 
states occurring in the fourth quarter 2007.  As in the past, pricing 
initiatives will be tailored to selected markets, brands and packages.   
    The commodity cost environment has not been favorable. Mitigating the 
impact of commodity cost pressures is a high priority at Anheuser-Busch.  The 
company has a strong record of consistently delivering significant annual 
productivity improvement savings, which management is confident will continue 
given plans and programs already in place. 
    Baker also provided highlights of the company's international beer 
business, which is an increasingly significant contributor to Anheuser-Busch's 
earnings growth.  The majority of international beer profits are driven by the 
company's 50 percent investment in Grupo Modelo, the leading brewer in Mexico 
and the brewer of Corona, the leading U.S. import brand.  The company is also 
well established in China, the largest and fastest growing beer market in the 
world, and particularly well-positioned in the country's most profitable beer 
segments.  Budweiser is by far the leading super-premium brand in China and 
Anheuser-Busch has a 27 percent equity stake in Tsingtao, China's leading 
premium brewer. 
    Baker reviewed the company's long-term earnings model, which continues to 
target growth in the 7 to 10 percent range.  Anheuser-Busch also consistently 
generates substantial cash flow, and cash returned to shareholders, including 
dividends and share repurchase, has increased significantly this year.  The 
company increased its quarterly dividend by 11.9 percent in July. Share 
repurchasing has also been enhanced as a result of the company's new, more 
aggressive financial leverage policy.  Management continues to expect to spend 
$2.7 billion on share repurchasing this year.   
 
    Other Matters 
    As previously announced, Anheuser-Busch's annual regional investor 
presentation is being broadcast live over the Internet today beginning at 8:00 
a.m. ET.  A replay will be available on the company's Web site.  For details 
visit http://www.anheuser-busch.com. 
 
    Notes 
 
    1. Calculation of 2006 Earnings per Share for 2007 Comparison Purposes 
       The table below sets forth the assumption used in comparing 2007  
       normalized earnings per share expectations to normalized 2006 results. 
 
 
    2006 Earnings Per Share                         Full Year  
    Reported                                           $2.53  
    Texas Income Tax Legislation Benefit in 2Q         (0.01)  
    Excluding One-Time Benefit                         $2.52 
 
 
    In the accompanying presentation, the following normalizations and terms  
are used: 
 
    2. Reconciliation of Comparative Third Quarter and Nine Months Results 
 
 
 
    ($ in millions, except per share)  
                                                 International     Diluted 
                                     Equity          Beer          Earnings 
    Third Quarter                    Income       Net Income       Per Share 
                           
    2007                                     
    Reported                         $185.2          $204.3          $.95   
    Gain on Sale of Distribution  
     Rights                              --              --          (.02)   
    Modelo Restructuring               16.0            16.0           .02   
    Excluding Normalization items    $201.2          $220.3          $.95   
      
    2006                                     
    Reported                         $156.5          $172.0          $.82   
      
    Percentage Change - 2007 vs. 2006        
    Reported                          18.4%           18.8%         15.9%   
    Excluding Normalization items     28.6%           28.1%         15.9%   
      
    Nine Months                              
    2007                                     
    Reported                         $539.3          $585.4         $2.49   
    Gain on Sale of Spanish   
     Theme Park                          --              --          (.01)   
    Gain on Sale of Distribution   
     Rights                              --              --          (.02)   
    Modelo Restructuring               16.0            16.0           .02   
    Excluding Normalization items    $555.3          $601.4         $2.48   
      
    2006                                     
    Reported                         $449.3          $492.9         $2.28   
    Texas Income Tax Legislation  
     Benefit                             --              --          (.01)   
    Excluding One-Time Item          $449.3          $492.9         $2.27   
      
    Percentage Change - 2007 vs. 2006        
    Reported                           20.0%           18.8%          9.2%   
    Excluding Normalization items      23.6%           22.0%          9.3%   
     
 
    3. Domestic revenue per barrel is calculated as net sales generated by the  
       company's U.S. beer operations on barrels of beer sold, determined  on  
       a U.S. GAAP basis, divided by the volume of beer shipped to U.S.  
       wholesalers. 
 
    4. The cash flow to total debt ratio is defined as: operating cash flow  
       before the change in working capital, adjusted for pension  
       contributions less service costs; divided by total debt, adjusted to  
       include the funded status of the company's single-employer defined  
       benefit pension plans.  
 
    This release contains forward-looking statements regarding the company's 
expectations concerning its future operations, earnings and prospects. On the 
date the forward-looking statements are made, the statements represent the 
company's expectations, but the company's expectations concerning its future 
operations, earnings and prospects may change. The company's expectations 
involve risks and uncertainties (both favorable and unfavorable) and are based 
on many assumptions that the company believes to be reasonable, but such 
assumptions may ultimately prove to be inaccurate or incomplete, in whole or 
in part. Accordingly, there can be no assurances that the company's 
expectations and the forward-looking statements will be correct. Important 
factors that could cause actual results to differ (favorably or unfavorably) 
from the expectations stated in this release include, among others, changes in 
the pricing environment for the company's products; changes in U.S. demand for 
malt beverage products, including changes in U.S. demand for other alcohol 
beverages; changes in consumer preference for the company's malt beverage 
products; changes in the distribution for the company's malt beverage 
products; changes in the cost of marketing the company's malt beverage 
products; regulatory or legislative changes, including changes in beer excise 
taxes at either the federal or state level and changes in income taxes; 
changes in the litigation to which the company is a party; changes in raw 
materials prices; changes in packaging materials costs; changes in energy 
costs; changes in the financial condition of the company's suppliers; changes 
in interest rates; changes in foreign currency exchange rates; unusual weather 
conditions that could impact beer consumption in the U.S.; changes in 
attendance and consumer spending patterns for the company's theme park 
operations; changes in demand for aluminum beverage containers; changes in the 
company's international beer business or in the beer business of the company's 
international equity partners; changes in the economies of the countries in 
which the company, its international beer business or its international equity 
partners operate; future acquisitions or divestitures by the company, 
including effects on its credit rating; changes resulting from transactions 
among the company's global or domestic competitors; and the effect of stock 
market conditions on the company's share repurchase program. Anheuser-Busch 
disclaims any obligation to update or revise any of these forward-looking 
statements. Additional risk factors concerning the company can be found in the 
company's most recent Form 10-K. 
 
SOURCE  Anheuser-Busch Companies 
    -0-                             11/29/2007 
    CONTACT:  Brenda Williams of Anheuser-Busch Companies, [phone],  
[e-mail]; or Investors, [phone], for 
Anheuser-Busch Companies 
    Web site:  http://www.anheuser-busch.com 
    (BUD) 
 





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