SABMiller Reports Drop in Volumes in Q4
Financial performance has been impacted by significant unfavourable currency movements in the second half of the year. However, the financial results of the group remain in line with expectations.
16/04/09 SABMiller plc has said in a trading update that lager volumes for the full year were 2% ahead of the prior year and level on an organic basis, with a 1% decline in the fourth quarter. Soft drinks volumes for the full year grew organically by 5%. Economic conditions deteriorated in the second half and consumer demand has fallen in most markets, particularly in the fourth quarter. Group revenue has continued to benefit from price increases and has grown in high single digits for the full year on an organic basis at constant rates of exchange. Financial performance has been impacted by significant unfavourable currency movements in the second half of the year. However, the financial results of the group remain in line with expectations.
In Latin America, lager volumes were up 1% for the year, with a decline in the fourth quarter. In Colombia, full year volumes were down 6% despite a continuing rise in our share of total alcohol. The fourth quarter was soft, reflecting deteriorating consumer demand and beer price increases. In Peru, volumes ended 9% above the prior year and we gained market share. Growth in the last quarter slowed significantly in a weakening economy. Ecuador volumes grew 14% consistently throughout the year in a market buoyed by an increase in disposable income. Soft drinks volumes for the region grew 2% for the year on an organic basis.
Europe organic lager volumes were level with the prior year reflecting the impact of the economic downturn on consumer disposable income, particularly in the second half of the year. Poland achieved organic volume growth of 3% and increased market share. In Romania, full year volume growth was 18% but the rate of volume growth slowed significantly in the second half. Full year organic volumes in Russia were 7% down, reflecting the de-stocking of wholesaler inventories in the second and third quarters, but level in the fourth quarter. In the Czech Republic, full year domestic volumes declined by 4% in a market affected by consumer down-trading.
MillerCoors U.S. domestic sales to retailers ("STRs") for the nine months to 31 March 2009 were down 0.4% against the prior year on a pro-forma basis with 0.4% growth in the quarter to March (after adjusting for one less trading day in the quarter). Net pricing growth remained strong while early progress with integration helped to accelerate the realisation of synergies. Premium light brand volumes were up marginally in the quarter with Coors Light STRs up low single digits while Miller Lite STRs were down mid single digits. The continued acceleration of Miller Genuine Draft 64 led to volume growth in the Miller Genuine Draft franchise in the quarter for the first time in a decade. Blue Moon and Peroni Nastro Azzurro also continued to perform well. Miller High Life growth accelerated and Keystone Light performed strongly.
Africa and Asia delivered organic growth of 4% in lager volumes for the year. In Africa, lager volumes grew by 5% despite a fourth quarter in which the global economic slowdown began to take effect in most key markets. Soft drinks volumes for the region grew 13% for the year on an organic basis while traditional beer volumes grew more than 25% on the same basis. Tanzania lager volumes grew 4% in the year, although fourth quarter volumes were affected by weaker consumer demand, whilst Botswana has been affected by the introduction of a 30% social tax levy on alcohol with effect from 1 November 2008. Angola and Uganda have grown well and Zambia has benefited from lower pricing following an excise reduction. Castel volumes grew robustly led by strong performances in Angola and Cameroon. In China, CR Snow delivered a solid performance for the year with organic lager volume growth of 4%, in addition to robust price increases. China achieved double digit growth in the fourth quarter, with very strong growth in the important western and central regions. India volumes grew 5% in the year with a stronger fourth quarter. Growth in Australia was in excess of 60% led by strong performances of Peroni Nastro Azzurro and Miller Chill.
In South Africa, full year lager volumes were down 2% on the prior year, with a weakening trend in the last quarter. Soft drinks volumes grew 4% for the year. Growth in the fourth quarter was adversely affected by Easter timing, deteriorating economic conditions and regulatory constraints on beer sales imposed in the Western Cape from January.
