SABMiller’s Q3 Volumes Flat
Consumer demand during the quarter varied across markets, with some showing tentative signs of recovery, whilst in others demand remained subdued. The financial performance of the group in the quarter was in line with expectations.
19 Jan 2010 --- SABMiller plc has provided an interim management statement for the group's third quarter ended 31 December 2009. On an organic basis lager volumes for the third quarter were level with the prior year, and 1% below last year for the first nine months of the financial year. Soft drinks volumes grew 2% in the quarter on an organic basis. Consumer demand during the quarter varied across markets, with some showing tentative signs of recovery, whilst in others demand remained subdued. The financial performance of the group in the quarter was in line with expectations.
In Latin America, lager volumes grew by 4% in the quarter. Lager volumes in Colombia grew 6% benefiting from good weather, an increase in consumer disposable income and strong operational execution. The quarter also benefited from a soft October in the prior year which was impacted by a price increase. In Peru, lager volumes were up 1%, notwithstanding growth of 14% in the same quarter last year, with strong sales execution driving further market share gains. Good growth continued in Ecuador with lager volumes up 9% reflecting the success of sales initiatives and wider retail outlet penetration. Soft drinks volumes were up 9% in the region on an organic basis due to a strong sales performance in Central America.
In Europe, third quarter lager volumes declined 2% on an organic basis. Organic volumes in Russia grew 34%, reflecting significant buy-in ahead of a substantial excise increase in January and the impact of de-stocking of wholesaler inventories in the prior year. Poland's volumes were down 5% in a declining market, although we continued to improve our market share. In Romania, lager volumes declined 18% on an organic basis, against a strong prior year growth comparative of 11%, but the company increased market share. In the Czech Republic, domestic volumes declined by 5%, notwithstanding some buy-in ahead of an excise increase in January, as the company continued to be negatively impacted by our exposure to the on-premise channel which has suffered during the economic downturn.
MillerCoors domestic sales to retailers were down 3.6% against the prior year in the quarter, amidst a challenging industry and economic environment. Premium light brand volumes fell mid single-digits due to a decline in Miller Lite and to a lesser extent in Coors Light, which were partly offset by continued strong growth of MGD 64. The craft and import portfolio was down slightly in the quarter though Blue Moon and Peroni Nastro Azzurro delivered high single and mid single-digit growth, respectively. The below premium portfolio was also down slightly while Keystone Light achieved high single-digit growth in the quarter. Domestic sales to wholesalers declined 4.2% in the same period.
In Africa, lager volumes rose 7% on an organic basis. Soft drink volumes performed well across the region growing 7% on the same basis. In Zambia, lager volumes were up 17%, assisted by an excise reduction in March 2009 and lager volume growth in Uganda was strong as we continued to benefit from additional capacity. Mozambique's lager volumes grew 11% aided by a resilient economy and strong growth in the northern region supported by the commissioning of our new brewery in Nampula. Lager volumes in Angola grew 17% assisted by additional capacity. Our associate, Castel, enjoyed a robust performance across the region with lager volumes up 13%. Lager volumes in Botswana were down 29%, with some reduction in the rate of decline as the social levy imposed in November 2008 was cycled, although sales continued to be hampered by a weak economy. Despite holding market share, volumes in Tanzania declined 8% impacted by unseasonal weather and a soft economy.
Lager volumes in Asia grew 5% on an organic basis. Organic volume growth in China slowed to 6% with heavy snow and wet weather suppressing demand across the country. Our volumes in India were down 7% following excise increases and a continuation of regulatory impediments.
In South Africa, lager volumes declined 4% in the quarter as the country continued to experience a softening of consumer demand. Market share declined marginally over the quarter. Soft drinks volumes were down 5%, impacted by a weak economy and unseasonal cold weather at the start of the quarter.
