| Thu 29 Nov 2001, 0:00 | | South African Breweries Plc - Interim Results - St |
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INTERIM ANNOUNCEMENT
STRONG PERFORMANCE FROM INTERNATIONAL OPERATIONS
London and Johannesburg, 29 November 2001. South African Breweries plc, the
leading brewer in developing markets, today announces its six-month results
to 30 September 2001. Highlights are:
Financial
2001 2000 %
change
US$m US$m US$ GBP
Turnover 2,176 8
2,106 3
Trading profit 348 334 9
4
- before amortisation 365 343 6 11
(EBITA)
Profit before tax 310 2
302 (3)
Adjusted earnings per share
*
US cents 25.7 24.8 8
4
SA cents (up 23%) 213.0 172.6
Dividend per share (US 6.5 6.5 -
cents)
* Prior year restated for change in accounting policy -deferred tax
Operational
Total beverage volumes up 10% to 47.8 million hls
Group EBITA margin grows by 50 basis points
Very strong performance from our European business - EBITA up 28%
Acquisitions made in China, India, Uganda and Romania, in line with strategy
Major Central American acquisition announced today
Graham Mackay, Chief Executive, commented: "Our businesses have delivered
good results during the first half with SABI Europe achieving volume growth
of 7% and Beer South Africa improving its operating margin by 30 basis
points. Today we have announced a significant new investment in Central
America, a region which offers great potential. We continue to focus on
growing our operations, both organically and through international
acquisition, to deliver shareholder value."
This announcement, a copy of the slide presentation and video interviews
with management are available on the SAB plc website at www.sabplc.com and
at www.cantos.com
CHIEF EXECUTIVE'S REVIEW
Business review
Operating performance
During the first half of the financial year, our businesses have delivered a
good performance with underlying improvements in our South African
operations and strong growth from SAB International (SABI), as we continue
to build on the solid positions established in Central and Eastern Europe,
Africa and China. Our alliance with the Castel group in Africa, established
in April 2001, is settling down well. During the period, we made further
investments in the SABI territories enhancing our already strong base. The
substantial growth and strong operating performance from SABI will continue
to increase the proportion of our business and results derived from outside
South Africa.
In the first six months, total beverage volumes increased by 10% (organic
3%) over the prior year's first half, with lager beer volumes up by 11% and
ther beverage volumes up by 5%. Operating profit before amortisation mproved
by 6% and adjusted earnings per share by 4%, with margin enhancement being
obtained in all of our major operations. This positive result was achieved
despite the impact of a 16% depreciation in the rand against the US dollar
over the period and currency depreciation in certain of the African
countries in which we operate.
SABI Europe (reporting as a segment for the first time) performed well,
especially in our key markets of Poland, Czech Republic and Russia. An
ongoing focus on brand portfolio management has delivered pleasing volume
growth of the major brands in each of these countries. Continued cost
management, rationalisation and productivity initiatives across the region
have contributed to a strong improvement in margins.
In SABI Africa and Asia (also reported as a segment) performance was ahead
of the prior year, assisted by the first time inclusion of our associate,
Castel. Strong underlying performances from most of our African operations
were diluted by the depreciation of some currencies, and in China,
competitive pressures were experienced, particularly in the South-West
region.
In South Africa, the pressures on disposable income have lessened. A strong
marketing focus resulted in a decline in sales volumes being limited to 1%,
and tight financial and operating controls helped margins improve by 30
basis points.
Other Beverage Interests posted good results in local currency with volumes
up 3%.
The Hotels and Gaming division had a difficult six months with hotels
adversely impacted by domestic economic conditions. Whilst gaming continues
to perform well, margins were affected by the higher overhead cost of the
Montecasino permanent facility.
General outlook
Our SABI business has delivered good results and the momentum we have
achieved should continue into the next six months.
In South Africa, the outlook for the economy and beverage volumes is
improving. In October and November beer volumes have, on a like for like
basis, shown growth and, year to date, are now ahead of the comparable
period last year. The rand has depreciated further in real terms over the
past few months, and this will have an adverse impact on our US dollar
results from South Africa over the important summer season.
We continue to focus on growing our operations, both organically and through
international acquisition, to deliver shareholder value.
SAB International - Europe
INCREASE IN VOLUMES AND STRONG MARGIN GAINS
2001 2000 %
change
Financial summary US$m US$m US$
Turnover 736 616 19
Trading profit 124 100 24
Operating margin (%) 16.8 16.3
EBITA* margin (%) 18.7 17.6
Sales volumes (hl 000's)
Lager 12,847 12,038 7
Lager comparable 12,744 12,038 6
Other beverages 94 75 25
* Earnings before interest, tax and goodwill amortisation
SABI Europe's performance for the six months to September was impressive.
Market share growth was recorded in Poland, Russia, Czech
