| Thu 19 Jan 2012, 9:00 | | SAB - SABMiller Plc - Trading update |
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SAB
SOSAB
SAB - SABMiller Plc - Trading update
SABMiller Plc
JSEALPHA CODE: SAB
ISSUER CODE: SOSAB
ISIN CODE: GB0004835483
19 January 2012
SABMiller plc Trading Update
SABMiller plc today issues its interim management statement for the group`s
third quarter ended 31 December 2011. The calculation of the growth rates in
this update excludes the effects of acquisitions and disposals on volumes and
revenues, unless otherwise stated.
Lager volumes for the third quarter were 3% ahead of the prior year with good
growth in all our regions with the exception of Europe and North America. Soft
drinks volumes grew by 6% for the quarter with growth across all regions.
Organic, constant currency group revenue grew 7% for the quarter. Group revenue
per hectolitre grew 3% on the same basis supported principally by price
benefits, with mix gains achieved in all regions except Europe. Overall,
financial performance for the quarter was in line with our expectations.
In Latin America, lager volumes continued to show robust growth with volumes up
8%. Colombia`s lager volumes increased by 6% with premium lager growth in
excess of 30% due to successful seasonal offerings and campaigns. Continuing
price restraint, improved weather and economic growth also contributed. In Peru
lager volumes grew by 9% as consumers traded up from the informal alcohol sector
supported by the national roll-out of the renovated Pilsen Callao brand and
successful Cusquena campaigns. Ecuador`s lager volumes increased by 15%
supported by the implementation of the direct service model and a focus on
festivals and events which encouraged consumers to move into the beer category.
In Central America lager volumes were up 6% with a particularly strong
performance in El Salvador following the introduction of larger packs as part of
our "affordability strategy". Soft drinks volumes in Latin America grew by 8%,
with our non-alcoholic malt brands up 21% and now rolled out into Central
America.
Europe`s lager volumes were down 2%. Beer markets remain affected by intense
competition, which continued negatively to impact mix, as well as fragile
economic conditions. Volumes in Poland and Romania were both down by 6%
reflecting the impact of planned de-stocking of wholesaler and distributor
inventories as well as continuing competition in pricing and promotions. In the
Czech Republic, domestic volumes grew by 2% reflecting the continued strong
performance of brand and package innovations. Volumes were down 6% in Russia in
a declining beer market. Strong growth continued in Ukraine where volumes
increased by 20%.
MillerCoors domestic sales to retailers (STRs) declined 3.3% in the quarter on a
trading day adjusted basis. Premium light brand volumes fell by low single
digits with Miller Lite down mid single digits and a low single digit decline
for Coors Light. The Tenth and Blake division saw double digit growth driven by
the success of craft brands and beer merchants` programmes. Below premium
volumes were down mid single digits. Domestic sales to wholesalers (STWs) were
down 1.6% in the quarter compared with the prior year.
Lager volumes in Africa grew by 11%, despite cycling strong comparatives (third
quarter volumes grew by 12% last year) and capacity constraints in a number of
markets. In Tanzania lager volumes grew by 13% driven by both solid growth in
premium brands and the strengthening of mainstream brands due to expanded and
intensified sales and distribution. Continued extension of market penetration
grew lager volumes in Uganda, up 17%. In Zambia lager volumes increased 16%
underpinned by robust growth of our mainstream portfolio against a backdrop of
strong economic conditions. Lager volumes in Mozambique grew by 8% benefiting
from the launch of the Impala brand, a cassava based beer, and strong growth in
the north of the country. In Zimbabwe our associate delivered lager volume
growth of 19% supported by further improved product availability. Our associate
Castel grew lager volumes by 9% with a strong performance in Cameroon and the
Democratic Republic of Congo. Soft drinks volumes grew by 9% driven by solid
performances from South Sudan, Ghana, Zimbabwe, and from our associate Castel.
In Asia Pacific lager volumes grew by 7% on an organic basis. Volumes in China
grew 5%, despite cycling a strong comparative period. Including the impact of
regional acquisitions, China`s volumes were up 11%. In India volumes were up
21% benefitting from the lifting of trading restrictions in Andhra Pradesh,
which had constrained volumes in the same quarter of the prior year, as well as
good growth in the focus states of Karnataka and Haryana.
On 16 December 2011, the group completed the acquisition of Foster`s in
Australia for a total cash consideration of approximately A$10,483 million
(approximately US$10,465 million), and the Asia segment was renamed the Asia
Pacific segment. Volumes for Foster`s are not included in third quarter group
or divisional results. On a pro forma basis, Foster`s volumes for the quarter
ended 31 December 2011 were 6% below the same period in the prior year. The
beer category overall is estimated to have declined at a slightly slower rate
in the quarter.
In South Africa, in a challenging economic environment, lager volumes grew 2%.
Growth was driven largely by momentum from our core power brands, particularly
Castle Lite and Castle Lager, as we continued to make targeted investments in
our portfolio and focused on improving retail execution and customer service.
Soft drinks volumes increased 1% despite tough trading conditions and cycling
strong growth of 9% in the comparative quarter. The performance was buoyed by
growth in two litre PET and immediate consumption packs.
On 19 October 2011, the group announced its intention to form a strategic
alliance with Anadolu Efes. The group intends to transfer its Russian and
Ukrainian beer business to Anadolu Efes, and to take a 24% equity stake in the
enlarged group, which will be the vehicle for both groups` investments in
Turkey, Russia, the CIS, Central Asia and the Middle East. The alliance will
result in the enlarged Anadolu Efes strengthening its market position to become
the number two brewer, in value terms, in the large Russian beer market. It is
already the leading beverage producer in Turkey, with 89% of the beer market and
a 69% share of the carbonated soft drinks market, and it has leading market
positions in the growth beer markets of Kazakhstan, Moldova and Georgia.
Subject to finalisation of the definitive legal agreements and relevant
regulatory approvals, the group expects to complete the transaction before the
end of the financial year ending 31 March 2012.
On 4 November 2011, East African Breweries Limited launched a public offer
through the Dar-es-Salaam Stock Exchange for the sale of its 20% interest in
Tanzania Breweries Ltd, the group`s subsidiary in Tanzania. The offer closed on
25 November 2011. SABMiller Africa BV applied for all of the shares offered,
but the offer was substantially oversubscribed, and after priority allocations
were made to applicants who were Tanzanian residents or East African residents
in accordance with local securities laws, SABMiller Africa BV was allocated
shares representing an additional 4.72% of Tanzania Breweries Limited,
increasing its interest to 58% (36% group effective economic interest).
On 25 November 2011 SABMiller Africa BV disposed of its 20% interest (12% group
effective economic interest) in its associate Kenya Breweries Limited to East
African Breweries Limited for cash consideration of US$205 million.
During November and December 2011 two of SABMiller`s African subsidiaries,
Zambian Breweries plc in Zambia and Nile Breweries Ltd in Uganda, launched
rights issues to raise approximately US$70 million each, and in January 2012 the
group`s subsidiary in Mozambique, Cervejas de Mocambique SARL, launched a rights
issue to raise approximately US$40 million, in each case primarily to fund
recently announced capacity expansions. The rights issues in Uganda and
Mozambique remain open, and, following closing of the rights issue in Zambia,
SABMiller Africa BV`s interest remains unchanged at 87% (group effective
economic interest unchanged at 54%).
With effect from 1 January 2012, the group and Castel implemented a number of
organisation changes in their African operations as part of their strategic
alliance agreement. The changes involve the combination of the operational
management of the Castel and SABMiller businesses in Nigeria and Angola, with
the Nigerian businesses being managed in future by SABMiller, and the Angolan
businesses being managed by Castel.
On 13 January 2012, the group completed the acquisition from Coca-Cola Amatil
Limited (CCA) of CCA`s 50% interest in the group`s Australian joint venture,
Pacific Beverages (Pte) Limited, for cash consideration of A$326 million.
Pacific Beverages is now a wholly owned subsidiary of SABMiller.
On 17 January 2012, the group successfully completed a US$7,000 million bond
issue in four tranches: US$1,000 million 1.85% notes due 2015, US$2,000 million
2.45% notes due 2017, US$2,500 million 3.75% notes due 2022 and US$1,500 million
4.95% notes due 2042. The net proceeds were used to repay in part the bank
borrowing incurred to finance the acquisition of Foster`s.
In December 2011 the group announced the appointment of Ari Mervis (who had been
Managing Director, SABMiller Asia since 2007) as Managing Director, SABMiller
Asia Pacific and Chief Executive Officer of Foster`s, with effect from 16
December 2011. The group also announced the appointment of Harald Harvey as
Managing Director Asia, with effect from 1 February 2012. Harald will report to
Ari Mervis and will oversee SABMiller`s businesses in India and Vietnam, and its
ongoing regional business development and export operations, as well as
providing support to CR Snow.
END
Notes to editors
SABMiller plc is one of the world`s largest brewers with brewing interests and
distribution agreements across six continents. The group`s wide portfolio
includes global brands Pilsner Urquell, Peroni Nastro Azzurro, Miller Genuine
Draft and Grolsch, as well as leading local brands such as Aguila, Castle,
Miller Lite, Snow, Tyskie and Victoria Bitter. SABMiller is also one of the
world`s largest bottlers of Coca-Cola products.
In the year ended 31 March 2011, the group reported US$4,491 million adjusted
pre-tax profit and group revenue of US$28,311 million. SABMiller plc is listed
on the London and Johannesburg stock exchanges.
This announcement is available on the company website: www.sabmiller.com
High resolution images are available for the media to view and download free of
charge from www.sabmiller.com/imagelibrary
Broadcast footage is available in internet or SD/HD quality for download free of
charge from www.sabmiller.com/broadcastfootage
Enquiries
SABMiller plc
t: +44 20 7659 0100
Sue Clark
Director Corporate Affairs
SABMiller plc
t: +44 20 7659 0184
Gary Leibowitz
Senior VP, Investor Relations
SABMiller plc
t: +44 20 7659 0174
Nigel Fairbrass
Head of Media Relations
SABMiller plc
t: +44 7799 894265
This announcement does not constitute an offer to sell or issue or the
solicitation of an offer to buy or acquire securities of SABMiller plc (the
"Company") or any of its affiliates in any jurisdiction or an inducement to
enter into investment activity.
This announcement includes "forward-looking statements". These statements may
contain the words "anticipate", "believe", "intend", "estimate", "expect" and
words of similar meaning. All statements other than statements of historical
facts included in this announcement, including, without limitation, those
regarding the Company`s financial position, business strategy, plans and
objectives of management for future operations (including development
plans and objectives relating to the Company`s products and services) are
forward-looking statements. These forward-looking statements involve known and
unknown risks, uncertainties and other important factors that could cause the
actual results, performance or achievements of the Company to be materially
different from future results, performance or achievements expressed or
implied by such forward-looking statements. These forward-looking statements
are based on numerous assumptions regarding the Company`s present and future
business strategies and the environment in which the Company will operate in
the future. These forward-looking statements speak only as at the date of this
announcement. The Company expressly disclaims any obligation or undertaking to
disseminate any updates or revisions to any forward-looking statements contained
in this announcement to reflect any change in the Company`s expectations with
regard thereto or any change in events, conditions or circumstances on which any
such statement is based. Any information contained in this announcement on the
price at which the Company`s securities have been bought or sold in the past, or
on the yield on such securities, should not be relied upon as a guide to future
performance.
Date: 19/01/2012 09:00:01 Produced by the JSE SENS Department.
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