Brewing giant reveals cost cutting drive

AB InBev revealed aims to increase savings by 14​ per cent​ to £2.3​bn​.

The group is already expected to axe around 5,500 jobs, around 3​ per cent​ of its combined workforce, as a result of the merger, which completed in September and made history as the UK's biggest ever corporate deal.

Details of the cost savings came as AB InBev announced annual results showing a slide in profits and a weak end to 2016 after tough trading in its second largest market, Brazil.

Underlying earnings fell 0.1​ per cent​ to £13.7​bn, dragged lower by a worse-than-expected 3.6​ per cent​ drop to £4.3​bn in the final three months of last year.

ABInBev said it had no update on planned job cuts, saying the extra cost savings are expected to come from buying and other synergies.

It confirmed the integration of Fosters and Peroni brewer SAMiller was already "well under way".

It ​said the new cost savings target included ​the ​£854​m that SABMiller ha​s​ already announced.

The group said it had already made​ ​£675​m of savings, with the remainder expected to come in the next three to four years.

ABInBev is now more than double the size of its closest rival Heineken following the merger, with more than 500 beer brands.

But the annual figures took the shine off 2016 for the group, which ABInBev said was a "difficult year".

"A challenging environment in Brazil has put pressure on the consumer and impacted our results," it ​said.

It was hit by a downturn in Brazil, where sales of beer volumes dropped heavily, plunging by 17​ per cent​ quarter-on-quarter in the final three months, as the country suffers its worst recession in years.

Overall, group-wide beer sales by volume fell 2​ per cent​ after a 3.3​ per cent​ slide in the fourth quarter.

But ABInBev said it was confident over its future as a merged company.

It added: "In 2016, we laid a solid foundation, and now in 2017, our first full year as a new company, we will build a bridge from the old AB InBev to the company we aspire to be."