This is where I’m from.

China is the world’sfastest-growing and largest beer market by volume.

International Beer Operations

Since the formation of Anheuser-Busch International in1981, the global reach of the company and our flagshipbrand, Budweiser, has continued to expand. Today,Budweiser is brewed locally in 10 countries and sold inkey beer markets around the world. The company hassignificant equity investments in two of the most impor-tant beer markets outside of the United States: Chinaand Mexico.

The international division has achieved success bycarefully executing a two-pronged strategy for growth— expanding the Budweiser brand globally and creatingstrong partnerships with leading brewers around theworld. Since 1999, Anheuser-Busch International’s netincome has increased by $400 million as a result ofdevelopment in both Anheuser-Busch operations andour equity investments.

In 2005, Anheuser-Busch International’s salesvolumes grew by 43 percent, including the impact ofequity partners and our Harbin brewery acquisition.Anheuser-Busch operations increased sales volume by50.8 percent, and volume from equity partnerships inMexico and China increased 36.6 percent. In total,Anheuser-Busch International volume reached47.2 million barrels in 2005.

International expansion and growth remain priori-ties for Anheuser-Busch. The company will achieve both by continuing to produce the highest-quality beers,

by investing in image marketing to attract adultconsumers, by creating strong sales and distributionsystems, and by strengthening our existing equity part-nerships and seeking new alliances in strategic markets.

Leading the way for future growth potential is the People’s Republic of China. Eleven years ago,Anheuser-Busch established the goal of becoming aleading brewer in what is now the world’s largest andfastest-growing beer market. Today, Anheuser-Busch hasmade significant progress toward this objective throughits Budweiser Wuhan Brewery operation, its 2004 acqui-sition of China’s fifth-largest brewer, Harbin, and itsstrategic alliance with the No. 1 brewer in China, theTsingtao Brewery. China is now second to Mexico inoverall profit contribution to the international companyand holds tremendous long-term potential as the countryand its beer industry continue to develop rapidly.

There are a number of reasons that China is one ofthe most important markets for Anheuser-Busch outside the United States. During the past five years, the beerindustry in China has grown more than it has inEurope, North America and South America combined.Yet, current per capita consumption levels are only20 percent of the levels of many developed countries,such as the United States, and 50 percent of the levels inJapan and Korea. An increase in per capita consumptionto the levels of its neighbors in Japan and Korea would

This is ourworld.

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Sales of Anheuser-Busch brands

outside the United States in 2005,

combined with our share of equity

partner volume, totaled more than

47million barrels.

International Beer Operations

result in the Chinese beer industrydoubling to 500 million barrels.

While volume growth in theChinese beer industry has beenspectacular, industry profit lagsbehind global standards. However,with continued economic growth,rising personal incomes, continueddevelopment of cities and suburbs,and the consolidation of breweriesand beer brands, improved prof-itability is likely.

Anheuser-Busch, as one of the first brewers to expand intoChina, is well-positioned to capi-talize on the future growth of theChinese beer industry. Through our successful Budweiser Wuhanoperation, our ownership of theHarbin Brewery, and our strategicpartnership with Tsingtao,Anheuser-Busch continues to gainmomentum in the most importantinternational market for beer.

Budweiser WuhanInternational BrewingCompanyAnheuser-Busch purchased itsbrewery in Wuhan in 1995 andcurrently brews Budweiser, Bud Iceand Budweiser Ultra, a loweralcohol brew available only inChina. To meet growing demand,brewery capacity has more thanquadrupled since Anheuser-Buschfirst invested in the brewery in1995, and production is currently3.4 million barrels annually. In late2005, the Wuhan Brewery beganproducing Harbin Ice and Harbin1900 Classic and expanded thedistribution of these brands toinclude Hong Kong and easternand southern mainland China.

BUDWEISER IN CHINA

Budweiser is distributed nationallyin China and is positioned in thesuper-premium beer segment. Ourbrand development efforts in Chinaare focused on three areas:

The first is consistentlyproducing high-quality beer thatmeets the company’s global stan-dards. The local management andbrewing, operations and technologyteams ensure that Budweiser andthe other Anheuser-Busch brandsproduced in Wuhan meet thesestrict quality standards.

Second, Anheuser-Buschsupports Budweiser and thecompany’s other brands in Chinawith a strong marketing platform,including innovative advertising,top-notch sports sponsorships andcontemporary music promotions.Budweiser is the official interna-tional beer sponsor of the 2008Olympic Games in Beijing and it is the official beer sponsor of the China Olympic team. Thesesponsorships enable Budweiser to connect with adults in Chinawho enjoy beer.

Third, the company has devel-oped a strong wholesaler distribu-

tion network modeled after thecompany’s U.S. distribution systemand modified for the Chinese beermarket. Today, through wholesalers,Anheuser-Busch is able to distributeBudweiser nationally. This is accom-plished through a network of 160distributors with more than 70 per-cent selling only Anheuser-Buschbrands in their beer portfolio.

Tsingtao Brewery Co. Ltd.The Tsingtao Brewery is China’slargest brewer and brews the leadingexport beer from China. The com-pany operates 50 breweries acrossChina and, along with Budweiser,Tsingtao is the country’s only othernationally distributed beer brand.

In 1993, Anheuser-Busch madean initial investment in Tsingtao.Today, that investment has evolvedinto a strategic alliance that enablesthe companies to share best practices and help Tsingtao andAnheuser-Busch achieve their long-term partnership goals in China. In April of 2005, Anheuser-Buschconverted all outstanding bonds toequity and increased its economicownership of Tsingtao to27 percent. Anheuser-Busch hasday-to-day involvement with thecompany through on-site manage-ment teams in brewing, strategyand finance and through two seats on Tsingtao’s board of directors.

Harbin Brewery Group Ltd.With the 2004 acquisition ofHarbin, China’s fifth-largestbrewer, Anheuser-Busch increasedits presence throughout northernChina, where per capita beerconsumption is nearly twice thenational average. In addition toexpanding the availability of Harbinpremium brands to eastern andsouthern China, Anheuser-Busch is introducing Harbin as an exportbrand to the United States in 2006.The company’s strategy is to capi-talize on the quality and popularity

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10 YEARS IN CHINA In 2005,Budweiser celebrated its 10thanniversary in China.

International Beer Operations

of Harbin’s beer, the strength of the Harbin name and the image of the company as China’s oldestbrewer. In October 2005, Harbinwas awarded the China Top BrandAward by a committee of repre-sentatives from the government,industrial associations, media andbusiness professionals based on the brand’s market value, overallquality, economic impact andpotential for future development.

Anheuser-Busch has a long-standing commitment to thecommunities where it operates. InChina, the company works closelywith the city of Harbin through theHarbin City Anheuser-Busch CivicDevelopment Fund. Through the fund, Anheuser-Busch joins cityofficials to promote the region as a good place for business andtourism. To date, the fund has

sponsored an international businessdevelopment conference and contri-buted to an annual beer festivalthat attracts thousands of touriststo the region. An Anheuser-Buschinvestment of $8 million in thefund will encourage long-termeconomic, business and educationaldevelopment in Harbin and thesurrounding areas.

China is the most dynamicbeer market outside of the UnitedStates and, with its current platformfor growth, Anheuser-Busch is well-positioned to participate in the development of the country’sbeer industry.

MexicoAnheuser-Busch recognized the tremendous potential of theMexican beer market and formedan agreement with Grupo Modelo

to exclusively import and distributeBudweiser and Bud Light inMexico in 1989. This relationshipled to an equity investment andpartnership with Grupo Modelo in 1993. Modelo, the maker ofCorona, is the No. 1 brewer inMexico, with more than 56 percentshare of the beer market. Coronaremains the No. 1 import in theUnited States. In 2005, Modelosold more than 38 million barrelsof beer worldwide.

Mexico is the largest exportmarket for Anheuser-Busch, andsales of Budweiser and Bud Lightrepresent one-third of the importedbeer segment in Mexico. In 2005,Budweiser and Bud Light volumeincreased 35 percent, resulting in profit growth for the eighthconsecutive year.

LATIN AMERICA Mexico is the largest export market for Anheuser-Busch and sales of Budweiser and Bud Light repre-sent one-third of the imported beer segment in Mexico.

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European BusinessPerformance and GrowthThe United Kingdom is the largestand most profitable Europeanmarket for the internationalcompany, where Budweiser haslong held its position as the No. 1premium-packaged lager in bars,pubs, clubs and restaurants.Budweiser sales reached anotherrecord high in 2005 and today, oneout of every three premium brandssold in the U.K. is a Budweiser.

In addition to Budweiser, the Anheuser-Busch operated StagBrewery near London also brewsMichelob, Michelob ULTRA andBud Ice for the U.K. market and for export to continental Europe.

The company’s long-terminvestment in marketing, includingadvertising, sponsorship and tradepromotion, has enabled Budweiserto appeal to local beer drinkers.Sports sponsorship is an importantpart of Anheuser-Busch’s U.K.marketing. In addition to spon-soring the FIFA World Cup™,

Budweiser is a sponsor of the pres-tigious F.A. Premier League, thetop U.K. football league, and someof the league’s largest clubs —Manchester United, Chelsea F.C.and Arsenal F.C.

Elsewhere in Europe, Anheuser-Busch sells Budweiserthrough local brewer and importerpartnership arrangements.

In Ireland, Anheuser-Busch has had a partnership since 1986with Ireland’s leading brewer,Guinness, to brew and sellBudweiser. With the strength of theGuinness distribution system andinnovative marketing, Budweiserhas become one of the leading lagerbrands among Irish consumers.

In Spain, Sociedad AnonimaDamm brews and sells Budweiserunder a licensing agreement. Thebrand maintains a strong presencein contemporary bars and capital-izes on Spain’s passion for soccerthrough sponsorship of the FIFA World Cup™ and other local soccer sponsorships.

International Beer Operations

INTERNATIONAL SPONSORSHIPS Budweiser has been the official beer ofthe FIFA World Cup™ since 1986, and Anheuser-Busch is proud to continue itssponsorship of the 2006 FIFA World Cup™ in Germany.

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In Italy, Budweiser is brewedand sold under license by HeinekenItalia SpA, the No. 1 brewer inItaly. Heineken Italia has a strongsales force and a broad distributionnetwork that supports growth ofthe Budweiser brand in Italy. Inaddition to advertising targetingItaly’s contemporary adults,Budweiser served as the officialbeer sponsor of the 2006 OlympicWinter Games in Torino, wherespectators from around the globewere entertained at numerousBudweiser-sponsored events.

In 2006, Bud will enter Russiaas a result of a new local brewingand sales alliance between HeinekenRussia and Anheuser-Busch.

In Canada, the largest beermarket for Anheuser-Busch brands outside the United States,Budweiser is brewed and distributedby Labatt Breweries of Canadathrough a long-standing licensingagreement. Budweiser has been theNo. 1 brand in Canada for twoconsecutive years and it continues to gain market share. Bud Light,introduced in Canada in 1986, hasgrown significantly in recent yearsas lighter beers have becomeincreasingly popular in Canada.

In Argentina, CompañiaCervecerías Unidas brews, pack-ages and sells Budweiser under alicensing agreement. 2005 markedthe best year ever for Budweisersales in Argentina.

With excellent partnershipswith leading brewers in the twomost attractive international beermarkets — China and Mexico —and strong brand performance in large global beer markets,Anheuser-Busch is well-positionedto continue development of itsinternational business in the coming years.

This is my favorite.

In the U.K., Budweiser is the No. 1 premium packaged lager in bars, pubs, clubs and restaurants.